The long-term effects of school consolidation on human capital formation

Abstract

ABSTRACT This study investigates the long-term effects of school consolidation on human capital formation. We explore the implementation of a large-scale primary school consolidation programme in rural China aimed at improving the quality and efficiency of education. Using a difference-in-differences strategy, we find that exposure to the programme significantly increases the number of years of schooling completed by rural children. The effect changes with exposure duration to the RPSC programme and is stronger for children from areas with low economic development, areas with low educational inputs, and families with low parental education. Moreover, we provide evidence that improvements in input-based and output-based school quality are important mechanisms by which the programme affects educational attainment. Finally, the results of further analysis alert us to the adverse effects of the programme on noncognitive skills such as agreeableness and emotional stability, as well as on labour supply time in adulthood.