Magical Transition? Intergenerational Educational and Occupational Mobility in Rural China: 1988-2002

Abstract

This paper presents evidence on intergenerational educational and occupational mobility in Rural China over a period of 14 years (1988-2002). To understand whether the estimated intergenerational persistence can be driven solely by unobserved heterogeneity, we implement biprobit sensitivity analysis (Altonji et al. (2005)) and heteroskedasticity based identification of Klein and Vella (2009). The empirical results show that there have been dramatic improvements in occupational mobility from agriculture to non-farm occupations; a farmer’s children are not any more likely to become farmers in 2002, even though there was significant persistence in occupation choices in 1988. In contrast, the intergenerational mobility in educational attainment has remained largely unchanged for daughters, and it has deteriorated significantly for sons. There is strong evidence of a causal effect of parental education on a son’s schooling in 2002. We provide some possible explanations for the dramatic divergence between occupational and educational mobility in rural China from 1988 to 2002.

Keywords: Intergenerational Mobility, Rural China, Occupational Choice, Educational Attainment, Economic Reform, Heteroskedasticity Based Identification, Biprobit Sensitivity Analysis

JEL Classification: O12, J62