Human capital in Qing China: economic determinism or a history of failed opportunities?

Xu, Yi and Foldvari, Peter and Van Leeuwen, Bas (2013): Human capital in Qing China: economic determinism or a history of failed opportunities?

Abstract

The traditional education system in Qing China has been widely debated over the past decades. Some have argued it was efficient and furthered economic growth, while others have stressed its inefficient nature, which led to the introduction of the modern education system in the closing decades of the 19th century, followed by its total collapse in 1905. In this paper we make a first try to quantify above debate. Starting from the observation that below the well-known civil examination system there existed a whole system of popular and vocational education, we find that years of education in the population were still lower than in many European countries. More interestingly, whereas in European countries years of education increased strongly in the 19th century, our estimates of average years of education and the ABCC indices show that the level of education remained stable well into the 1920s when it accelerated. However, the main rise only occurred during the late 20th century. This finding leads to an interesting question since per capita income only started to grow significantly since the 1950s. This means that the rise of education since the mid-1920s was not as such driven by per capita income. Apparently this was the same for both the traditional and modern education since the latter had already started to transform Chinese education from the 1890s onwards. Hence, we have to look at the question why persons decided to follow education, i.e. was it individually profitable to follow education (positive private returns)? However, testing for this latter hypothesis shows that, after correction for foregone earnings, life expectancy, and probability of passing the exams, only the below shengyuan level students actually had positive returns. For an ordinary person it was therefore uneconomical to join in the civil examination system. Apparently this did not change, not even after the introduction of the modern education system, until the 1950s.

• Item Type: MPRA Paper
• Language: English
• Keywords: human capital; China, private returns; economic development
• Subjects: I - Health, Education, and Welfare > I2 - Education and Research Institutions > I21 - Analysis of Education; N - Economic History > N1 - Macroeconomics and Monetary Economics ; Industrial Structure ; Growth ; Fluctuations > N15 - Asia including Middle East

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