Estimating the Trend in the Returns to Education in China: Evidence from Longitudinal Data

The returns to education in both developed and developing countries are well documented, but their changes over time remain under-researched. Using one of the most extended longitudinal datasets from China, we estimate the trend in the returns to education over the period 1993-2015. We found that returns to education in China have increased over time, with a significant rise from 2004. However, the results of the estimation also show a slight decrease from 2010 to 2015. We also find that the returns to higher educational degrees are high and have grown faster, especially for vocational degree education. Our findings are robust to different estimation methods, and the results are consistent with the literature.