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Lookup NU author(s): Professor John Sessions
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© 2023 The University of Manchester and John Wiley & Sons Ltd.We investigate the relationship between education funding and educational inequality across Chinese prefectures. The decentralisation of education in China has created substantial variations in government educational expenditures, both over time and across regions. We propose that these variations relate to the budget preferences of local governors. These are age dependent with younger officials more inclined to invest in large and quantifiable infrastructure projects rather than public service provision. This provides a source of exogenous variation in local fiscal efforts to provide public education and thus permits quasi-experimental evaluation through instrumental variable identification. Our results suggest that increased education spending is linked with lower educational inequality. Moreover, we find strong evidence of heterogeneity - the magnitude of the effect is diminishing with the degree of local fiscal autonomy.
Author(s): Fan J, Huang J, Sessions JG, Ye J
Publication type: Article
Publication status: Published
Journal: Manchester School
Year: 2023
Volume: 91
Issue: 4
Pages: 283-305
Print publication date: 01/07/2023
Online publication date: 04/04/2023
Acceptance date: 28/02/2023
ISSN (print): 1463-6786
ISSN (electronic): 1467-9957
Publisher: John Wiley and Sons Inc
URL: https://doi.org/10.1111/manc.12435
DOI: 10.1111/manc.12435
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