The impact of parental education on children’s outcomes in China

Abstract

This paper exploits the exogenous shock to basic education during the Chinese Cultural Revolution to estimate the causal relationship between parental schooling and children’s educational attainment in China. Using deviations of cohort graduation rates from predicted education trends as instruments for parents’ education, the results indicate that an additional year of parental education increases children’s probability of completing junior and senior high schools by 7.94 and 9.76%, respectively. Parental education not only has positive and significant effects on children’s schooling outcomes, its importance also increases with children’s education level. These findings suggest that public investment in education has important long-term effects on individual’s educational achievement.