Three Essays in the Economics of Education

Abstract

This dissertation consists of three chapters studying topics in the economics of education. Chapter 1 investigates how changes in pension policies affect households' investments in their children's education. In China, elderly individuals receive financial support from their children, in addition to pension benefits and personal savings. The researchers used a difference-in-differences (DID) analysis to compare the investment behavior of households with enterprise employees (who were affected by the 1997 pension reform) and public sector employees (who were not affected) on household investments in human capital and savings. The results showed that households expecting lower pension benefits increased their investments in education by around 2%. Additionally, a 10% decrease in the pension replacement rate corresponded to a 1.1% rise in households' investments in human capital. The study also looked at the 2015 pension reform, which aimed to reduce pensions for public sector employees, but the increase in education investment among these employees was not statistically significant, possibly due to the gradual 10-year transition period. The findings suggest that when pension income is expected to decrease, households invest more in their children's human capital development to compensate. Chapter 2 studies how being admitted via affirmative action affects minority students in universities. This paper provides evidence on the effects of college admission preferential policy on students' self-perceptions, academic performance, and career intentions. We use regression discontinuity approach to compare students just below and above the cutoff with the same type of bonus points - ethnicity-based bonus points. Because of the bonus, students just below the cutoff may study in the same university as students above the cutoff. Therefore, we are able to eliminate the “peer effect”. Actual beneficiaries report negative self-perception compared with their peers, have lower college English test scores, and are less likely to get academic awards. As for their life plans, ethnicity-based beneficiaries are more inclined to find stable jobs and hope to get married sooner. Additionally, the placebo group in which students receive bonus points for academic achievements like math or physics Olympiad shows no impostor effects. These findings demonstrate that different categories of preferential policy have different effects on beneficiaries and provide insight into studying the impact of affirmative action in psychological aspect. Chapter 3 utilizes data from the China Family Panel Studies (CFPS) to investigate the effect of having a brother on women's educational attainment. The results indicate that gender discrimination persists in Chinese households' investment in human capital, with a significant negative impact of having a brother on women's education. The one-child policy, which limits family size and creates families without male offspring, has increased women's access to education by reducing competition with preferred siblings and decreasing opportunities for gender discrimination. The increase in women's average level of access to education since 1980s is the result of the combined effects of the reduction in the dilution of family resources and the reduction in opportunities for gender discrimination.