Analysis on inter-provincialdisparities of China’s rural

education and convergence rateEmpirical analysis on 31 provinces’

(municipalities’) panel data from 2001 to 2008

Tongwei XieResearch Institute of Finance and Economics,

Shanghai University of Finance and Economics, Shanghai, China

Abstract

Purpose – This article aims to analyze inter-provincial disparities of rural education and theconvergence rate, and to discuss the effects of compulsory education reform after 2001.

Design/methodology/approach – The article estimates the rural average education years andeducation Gini coefficients of China’s 31 provinces (municipalities) beside Hong Kong, Macao andTaiwan from 2001 to 2008, and applies the method of “economic convergence”.

Findings – The results show that after the reform of rural compulsory education, inter-provincialrural education disparities and educational equality have been significantly improved and trend toconvergence; nevertheless the convergence rate on inter-provincial disparities of education equalitydeclines. The defects of the education input system – “county as principle” – has been a factor thatrestricts the coordinated development of rural education.

Practical limitations – This paper suggests that it is necessary for China’s provincial and centralgovernment to afford the expense of compulsory education. China’s present investment system wouldalso worsen inter-provincial inequities of education.

Social implications – Education equality is one of the basic social priorities. In China educationequality has been improved; however it could be better if China’s provincial and central governmentafforded the expenses of compulsory education.

Originality/value – This paper applies the method of “economic convergence” to analyze China’srural education disparities among its regions.

Keywords Average educational years, Educational Gini coefficients, Convergence, China, Education,Educational policy, Rural areas

Paper type Research paper

1. IntroductionCoordinated regional development of education is the reflection of educational justiceand equality. Uncoordinated educational development among provinces in China hasbecome one of the significant issues of regional development. In 2001, China’sgovernment carried out reform of the investment system for compulsory ruraleducation. “County as principle” replaced “classification management”. This reformhas promoted the development of compulsory rural education in China and has tosome extent alleviated the problem of insufficient investment in education, andinter-provincial differences in rural education have also been significantly reduced.However, recent years’ practice shows that the “county as principle” investment

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/0951-354X.htm

IJEM25,7

714

Received October 2010Revised December 2010Accepted February 2011

International Journal of EducationalManagementVol. 25 No. 7, 2011pp. 714-723q Emerald Group Publishing Limited0951-354XDOI 10.1108/09513541111172117

system still cannot solve the problem of rural education poverty. Under the conditionsof farmers’ low income and the “county as principle” investment system, a countygovernment’s finances become the most important determinant of educationinvestment. In fact, most counties cannot ensure adequate investment in education.Counties’ governments have assumed the burden of compulsory education inputs,while central government and the provincial government share little responsibility.This investment system discourages the further development of compulsory ruraleducation. It is estimated that at present all of China’s investment in compulsoryeducation, the county governments’ share is 78 percent, provincial governments’ shareno more than 1 percent, and central government’s share much less. Therefore,inter-provincial disparities and inequality of education development are directlyinfluenced by regional economic differences.

On the other hand, because of higher agricultural productivity and rapid economicdevelopment, East China is demanding a larger labor force, and the registered system ofpermanent residence of recent years is not so strict as previously. All of this results in ahigh level of rural labor mobility. The rural laborers who move to East China mainlycome from Central and Western China, and they are better educated than those who stayin local regions. Additionally, in China, the investment system for compulsory ruraleducation has obvious territorial characteristics. This means that the educationinvestment for rural laborers who move to East China comes from the local governmentsof Central and Western China. As a result, investment and benefit in rural education inthese regions are significantly asymmetrical. This phenomenon will eventually reducelocal governments’ incentives for investment in rural education, and could also enlargeinter-provincial education development disparities and regional inequities.

In order to analyze these changes in inter-provincial differences in rural educationafter reform of the education investment system and how the inter-provincialdifferences converge, after estimating the rural average education years and educationGini coefficients of 31 provinces (municipalities) beside Hong Kong, Macao andTaiwan from 2001 to 2008, this article in addition applies the method of “economicconvergence” to analyze inter-provincial disparities of rural education and theconvergence rate. The article also comments on the effects compulsory educationreform – i.e. “county as principle” – after 2001.

2. Literature reviewSince 1978 China’s education has been significantly improved, but the issue ofunbalanced education development also highlights that scholars are concerned aboutthe issue. Wei and Yang (1997) found that regional differences in educationdevelopment decreased year by year. Wang et al. (1998) and Wu (1999) pointed out thateconomic development disparities among regions result in an imbalance in educationdevelopment. Zhu (2003) calculated the education Gini coefficient of inter-regionalinvestment from 1998 to 2000, with the results showing that the inequality of educationinvestment has increased in recent years. Tu’s (2005) study showed that China’sregional differences in education could be mainly seen from two aspects:

(1) the scale of regional of higher education development and educationalinvestment; and

(2) China’s region differences in education has been enlarged.

Analysis oninter-provincial

disparities

715

Du (2005) calculated the education Gini coefficient and found that inter-provincialeducation disparities had been reduced. Zhai (2006, 2007) also found that between1995 and 2004 basic education disparities declined after his theoretical andempirical analysis. Yang and Li (2007) estimated the education Gini coefficient ofChina’s 31 provinces from 1996 to 2004, and pointed out that China’s educationinequality had improved not only within regions, but also among regions. Sun(2008) also measured the education Gini coefficient in different periods, and foundthat China’s educational development reduced education inequality within eachregion.

The above research by Chinese scholars show two opposite conclusions, namelythat regional differences in education development have been either reduced orenlarged. According to the data used in this literature, research using data from after2001 tends to see a decrease, while research using data from before 2001 tends to see anincrease, because of the implementation of reform of the compulsory education system.However, there are few articles to apply the approach of “economic convergence” toanalyze inter-provincial education disparities. Until now, only Sun (2008) has takenadvantage of this method, and his study pointed out that China’s inter-provincialeducation disparities had gradually been reduced. Therefore, this paper also utilizesthe approach of “economic convergence” to analyze rural education disparities amongChina’s provinces and the convergence speed after investment system reform of ruralcompulsory education in 2001.

3. Calculations on average education years and education Gini coefficientof China’s rural areas3.1 Methods of measurementEducation level is divided into five different qualifications (i.e. illiterate orsemi-illiterate, primary, junior high school, senior middle school, college or above)and the education years are as follows:

. illiterate or semi-illiterate for 0 years;

. primary school for six years;

. junior high school for nine years;

. senior middle school for 12 years; and

. college or above for 16 years.

The mathematical formula that estimates the average years of education is defined asfollows:

AEY ¼X5

i¼1

EYi £ Pi:

In this formula, AEY represents average education years, i represents the number ofdifferent educational qualifications, EYi represents the education years of eacheducation level, and Pi represents the population percentage of each education level intotal population.

The mathematical formula that estimates the education Gini coefficient is asfollows:

IJEM25,7

716

EGini ¼X4

i¼1

ðTEAi £ Piþ1 2 TEAiþ1 £ PiÞ

����������;

where EAi represents the educational achievement percentage of each group. TEAi

represents the percentage of total educational achievements, and its formula is:

TEA ¼X5

i¼1

EAi ¼X5

i¼1

EYi £ PiX5

i¼1

EYi £ Pi

0BBBB@

1CCCCA:

3.2 Data sourcesThe data were taken from the China Statistical Yearbook and China PopulationStatistics Yearbook from 2002 to 2009. The statistic criteria was the population aged sixyears old and above, and according to the calculation formula, we obtain panel data ofthe average education years and education Gini coefficient from 2001 to 2008.

3.3 Estimation results3.3.1 Average education years and education Gini coefficient of China’s rural areas. Asshown in Table I, China’s rural average years of education increased from 6.752 in 2001to 7.285 in 2008. With the development of China’s rural education, China’s ruraleducation inequality has been greatly improved; the education Gini coefficient fell from0.237 to 0.217. It is notable that in 2005 the level of rural education developmentdeclined, and education inequality increased.

3.3.2 Average education years and education Gini coefficient of provinces’(municipalities’) rural areas. The rural average education years of every province(municipality) increased at different degrees, and rural education inequality was alsoobviously improved. However, plenty of provinces’ (municipalities’) educationdevelopment fell back in 2002 and 2005. In 2005, 24 provinces’ (municipalities’) ruralaverage education years declined: they were Tianjin, Inner Mongolia, Liaoning, Jilin,Heilongjiang, Shanghai, Zhejiang, Anhui, Fujian, Jiangxi, Shandong, Henan, Hubei,Hunan, Guangxi, Hainan, Sichuan, Guizhou, Yunnan, Tibet, Shaanxi, Gansu, Qinghai,and Ningxia. Provinces’ (municipalities’) education inequality also increased in both2002 and 2005. In 2002, these provinces were: Beijing, Tianjin, Hebei, Inner Mongolia,Jilin, Heilongjiang, Jiangsu, Zhejiang, Anhui, Jiangxi, Hunan and Guangdong, Guizhou,Tibet, Shaanxi, Gansu, and in 2005 they were Beijing, Shanxi, Inner Mongolia,Liaoning, Jilin, Heilongjiang, Shanghai, Fujian, Shandong and Henan, Hubei, Hunanand Guangdong, Guangxi, Hainan, Chongqing, Sichuan, Guizhou, Yunnan, Tibet,Shaanxi, Qinghai, Ningxia, and Xinjiang.

Category 2001 2002 2003 2004 2005 2006 2007 2008

Average education years 6.752 6.788 6.871 7.000 6.782 7.028 7.183 7.285Education Gini coefficient 0.237 0.240 0.235 0.231 0.248 0.231 0.223 0.217

Table I.Average education years

and education Ginicoefficient of China’s

rural areas, 2001-2008

Analysis oninter-provincial

disparities

717

4. Comparison of rural education developmentIn order to reflect the changes from 2001 to 2008 in educational disparities amongprovinces (municipalities), this paper shows four GIS charts of average education yearsand education Gini coefficient of provinces’ (municipalities’) rural areas.

4.1 Comparison of average education yearsFrom 2001 to 2008, 31 provinces’ (municipalities’) rural education was significantlyimproved, and inter-provincial disparities in rural education were also reduced. InFigure 1, in 2001, Jiangxi is the only province whose average education years ofeducation in rural areas is above eight years (blue), while Beijing, Tianjin, Shanxi,Jiangxi also achieved this in 2008. The rural average education years of Beijing,Tianjin, Hebei, Shanxi, Liaoning, Jilin, Heilongjiang, Henan, Hunan, Guangdong werebetween seven years and eight years (green) in 2001; this increased to 17 provinces in2008 (Hebei, Inner Mongolia, Liaoning, Jilin, Heilongjiang, Shanghai, Jiangsu, Zhejiang,Shandong, Henan, Hubei, Hunan, Guangdong, Guangxi, Hainan, Shaanxi, andXinjiang). The average years of education in rural Inner Mongolia, Shanghai, Jiangsu,Zhejiang, Anhui, Fujian, Shandong, Hubei, Guangxi, Hainan, Chongqing, Sichuan,Shaanxi, Ningxia and Xinjiang was between six and seven years (yellow) in 2001. In2008 this number dropped from 15 to eight provinces (Anhui, Fujian, Chongqing,Sichuan, Yunnan, Guizhou, Gansu, and Ningxia). The average years of education inrural Guizhou, Yunnan and Gansu was between five and six years (brown) in 2001;however in 2008 only the province of Qinghai saw this level. The rural averageeducation years in Tibet and Qinghai was below five years (red) in 2001, while onlyTibet showed this level in 2008.

4.2 Comparison of education Gini coefficientWith the development of rural education, from 2001 to 2008, inequality in ruraleducation in 31 provinces (municipalities) was also greatly improved. In Figure 2, in2001 the provinces (municipalities) with a rural education Gini coefficient below 0.20(blue) were Hebei, Shanxi, Inner Mongolia, Jilin, Heilongjiang, Shanghai; in 2008 theywere Hebei, Shanxi, Inner Mongolia, Jilin, Heilongjiang, Shanghai, Hubei, Guangdong,Guangxi, and Hainan. Provinces (municipalities) with a rural education Gini coefficientbetween 0.20 and 0.30 (green) in 2001 were Beijing, Tianjin, Liaoning, Zhejiang, Anhui,Fujian, Jiangxi, Shandong, Henan, Hubei, Hunan, Guangdong, Guangxi, Hainan,

Figure 1.Thirty-one provinces’(municipalities’) ruralaverage education years in2001 (left) and 2008 (right)

IJEM25,7

718

Chongqing, Sichuan, Guizhou, Gansu, and Tibet; in 2008 they were Beijing, Tianjin,Liaoning, Jiangsu, Zhejiang, Anhui, Fujian, Jiangxi, Shandong, Henan, Hunan,Chongqing, Sichuan, Guizhou, Yunnan, Gansu, Tibet, Ningxia and Xinjiang. Provinces(municipalities) with a rural education Gini coefficient between 0.30 and 0.40 (yellow) in2001 were Jiangsu, Yunnan, Qinghai and Xinjiang, while only Qinghai had this level in2008. Provinces (municipalities) with a rural education Gini coefficient above 0.40 (red)in 2001 were Shaanxi and Ningxia, while only Shaanxi showed this level in 2008.According to Figure 2, rural education equity in Northeast China and North China isbetter than in other regions, and in recent years Ningxia is the province that has seenthe greatest improvement in education fairness.

5. Convergence of rural education disparity among provinces5.1 s convergence of rural education disparitiesAccording to the definition of s convergence, the changes of dispersion are thefoundation to judge whether rural education disparity among provinces is converging.Here we use the variation coefficients of the average education years and the educationGini coefficient. The means and variations of the average education years andeducation Gini coefficient (Figures 3 and 4) show that after the reform of theinvestment system for rural compulsory education in 2001, China’s inter-provincialeducation development disparities and inequalities shrank year by year (except for2005), which shows significant s convergence.

5.2 b convergence of inter-provincial rural education disparitiesFor the b convergence analysis, this paper uses Barro and Sala-i-Martin’s (2005) model.The b convergence model is as follows:

1

Tlog

yi;tyi;t2T

� �¼ B2

1 2 e2bT

Tlog yi;t2T þ mi:

Using the panel data of the average education years and education Gini coefficientfrom 2001 to 2008, divided into three periods (2001-2004, 2005-2008 and 2001-2008), theconvergence speeds derived are shown in Tables II and III.

In all three periods – i.e. 2001-2004, 2005-2008 and 2001-2008 – the inter-provincialdisparities of education development showed convergence. The convergence rates

Figure 2.Thirty-one provinces’(municipalities’) rural

education Gini coefficientsin 2001 (left) and 2008

(right)

Analysis oninter-provincial

disparities

719

were 0.071 percent, 0.099 percent, and 0.042 percent, respectively. The inter-provincialdisparities of rural education inequality also show convergence, with convergencerates of 0.152 percent, 0.061 percent, and 0.107 percent, respectively. This is mainlybecause of the reform of the investment system for compulsory education after 2001,

Figure 4.Means and variations ofrural education Ginicoefficient amongprovinces from 2001-2008

Figure 3.Means and variations ofrural average educationyears among provincesfrom 2001-2008

Model 2001-2004 2005-2008 2001-2008

b 0.071 * * * 0.099 * * * 0.042 * * *

R 2 0.30 0.87 0.50~R 2 0.27 0.87 0.48

Note: * * *Indicates 1 percent significance level

Table II.Convergence speeds ofeducation developmentdisparities

IJEM25,7

720

which increased investment in rural education, and rural education has been improvedsignificantly. In 1985, China began to implement the reform of education finance andthe hierarchical management system. In this system, the burden of compulsoryeducation structure is irrational. Central and provincial government share little of theburden, but township government and farmers have to shoulder the burden of most ofthe investment in compulsory education. As the township government and farmers donot have sufficient finance, rural education has faced a serious shortage of funds. Since2001, in order to address the input problem of rural compulsory education, the countygovernment became the main investor in compulsory rural education. Theconvergence rates show that the reform effect of the financial system for ruralcompulsory education is obvious.

Further, we contrast the period 2001-2004 with 2005-2008: it is clear that theconvergence rate of education development disparities in 2005-2008 is 30.77 percentfaster than in the period 2001-2004, but the convergence rate of educational inequalitydisparities in the period 2001-2004 is 1.49 times faster than in the period 2005-2008.This difference indicates that the improvement effect of inter-provincial inequalitydisparities in education declined. To some extent, the reform of the rural compulsoryeducation system after 2001 accelerated the development of education andimprovements in education equality. However, this is still not enough. Provincialand central government invest relatively little in education. But county governmentscan afford adequate funds for the development of rural education. Therefore, ruraleducation investment is decided by local government revenue, which is directly subjectto local economic development. Also, economic development disparities among regionssignificantly affected inter-provincial differences in rural educational inequality. InCentral and Western China, local governments could not provide adequate investmentin rural education because the economy there is less developed than in Eastern China.Once the economic development disparities are decreased, the convergence rate ofinter-provincial differences in education equality will also decrease.

Moreover, currently, the number of China’s mobile rural laborers is great. Accordingto Chinese government statistics, the total has reached 230 million, of which over 150million have been out of work more than six months. Those rural laborers are bettereducated than others who stay in their local areas. They are mainly from Central andWestern China and move to Eastern China. Additionally, China’s education investmentsystem has obvious territorial characteristics, which means that the education input ofthose people comes from local governments in Central and Western China. However,Eastern China could take advantage of them without investment in their education.Thus, this will discourage local government investment in compulsory education;furthermore, it will worsen education inequality among provinces.

Model 2001-2004 2005-2008 2001-2008

b 0.152 * * 0.061 * * * 0.107 * * *

R 2 0.28 0.54 0.64~R 2 0.26 0.52 0.63

Notes: * *Indicates 5 percent significance level; * * *indicates 1 percent significance level

Table III.Convergence speeds of

education inequalitydisparities

Analysis oninter-provincial

disparities

721

6. ConclusionsAfter the investment system for rural compulsory education was reformed in 2001,rural education developed significantly, and inequalities in rural education have beengreatly reduced. Inter-provincial disparities of the education development andeducational inequality show significant convergence. However, the convergence ratesof inter-provincial disparities on education inequality have decreased. This is becausethe new investment system for rural compulsory education still cannot provideadequate funds, especially in Central and Western China. In addition, this investmentsystem has obvious territorial characteristics; local government in Central andWestern China cannot receive symmetrical returns because of large-scale rural labormobility. This phenomenon not only reduces local governments’ incentives to invest inrural education, it also worsens inter-provincial inequalities in education. Therefore,China’s education input system should be regulated again. In fact, in developedcountries, most of the investment in primary education is provided by centralgovernment. It is necessary for China’s provincial and central government to meet theexpenses of compulsory education.

References

Barro, R.J. and Sala-i-Martin, X. (1995), Economic Growth, McGraw-Hill, New York, NY.

Du, P. (2005), “Study on education differences among China’s schools based on Gini coefficient”,Education and the Economy, Vol. 3, pp. 30-4.

Sun, B. (2008), “Convergence test on China’s education development in the past thirty years afterreform and opening policy”, Journal of Education, Vol. 12, pp. 14-18.

Tu, D. (2005), “Educational disparities research”, Education Science, Vol. 2, pp. 8-11.

Wang, S., Du, Y. and Liu, Y. (1998), “Analysis on imbalance in educational development inChina”, Education Research, Vol. 6, pp. 19-23.

Wei, H. and Yang, D. (1997), “Decentralization and regional educational differences”, China SocialSciences, Vol. 1, pp. 98-112.

Wu, D. (1999), “Development of regional gaps in China’s education – imbalance problems ofeducation development”, Education Research, Vol. 7, pp. 22-6.

Yang, J. and Li, X. (2007), “Education inequality, human capital accumulation and economicgrowth: an empirical study on China”, Quantitative Economics & Technical EconomicsResearch, Vol. 2, pp. 37-45.

Zhai, B. (2006), “Balanced development of education: theory, indicators and calculation method”,Education Research, Vol. 3, pp. 16-28.

Zhai, B. (2007), “Empirical analysis on balanced development of basic education in China”,Education Research, Vol. 7, pp. 22-30.

Zhu, M. (2003), “An empirical study on education investment fair among China’s provinces”,Economic Issues, Vol. 2, pp. 121-4.

Further reading

Barro, R.J. and Lee, J.W. (1993), “International comparisons of educational attainment”, Journal ofMonetary Economics, Vol. 32 No. 3, pp. 364-94.

Barro, R. and Lee, J. (1993), “International measures of schooling years and schooling quality”,American Economic Review, Vol. 86 No. 2, pp. 218-23.

IJEM25,7

722

Bernard, A.B. and Durlauf, S.N. (1996), “Interpreting tests of the convergence hypothesis”,Journal of Econometrics, Vol. 71, pp. 161-73.

Kyriacou, G. (1991), “Level and growth effects of human capital: a cross-country study of theconvergence hypothesis”, Research Report 91-26, Starr Center for Applied Economics,New York University, New York, NY.

Lucas, R. Jr (1988), “On the mechanics of economic development”, Journal of DevelopmentEconomics, Vol. 22 No. 1, pp. 3-42.

Mankiw, N., Romer, D. and Weil, D. (1992), “A contribution to the empirics of economic growth inthe neoclassical model”, Quarterly Journal of Economics, Vol. 107, pp. 407-37.

Thomas, V., Wang, Y. and Fan, X. (2000), Measuring Education Inequality: Gini Coefficients ofEducation, The World Bank Institute, Washington, DC.

Thomas, V., Wang, Y. and Fan, X. (2003), “Measuring education inequality: Gini coefficients ofeducation for 140 countries, 1960-2000”, Journal of Educational Planning andAdministration, Vol. XVII No. 1.

Zhai, B. (2008), Educational Equilibrium Theory – Analysis on Balanced Development of BasicEducation in China, People’s Education Press, Beijing, pp. 46-50.

Corresponding authorTongwei Xie can be contacted at: yarhan20042005@yahoo.com

Analysis oninter-provincial

disparities

723

To purchase reprints of this article please e-mail: reprints@emeraldinsight.comOr visit our web site for further details: www.emeraldinsight.com/reprints