Education and Income Inequality in Asia: Is China an Outlier?

A lead in the New York Times focused on the plight and risk of China’s education race to the top among rural families.  It ended with the idea that China’s rapid educational attainment at college level over the past decade (from around 8% in 2000 to 23% enrolment rates through last year) may be contributing to income inequality where education is “losing its role as the social leveler.”

Specifically:

“Youths from poor and rural families consistently end up paying much higher tuition in China than children from affluent and urban families. Yet they attend considerably worse institutions, education finance specialists say. The reason is that few children from poor families earn top marks on the national exams. So they are shunted to lower-quality schools that receive the smallest government subsidies.The result is that higher education is rapidly losing its role as a social leveler in China and as a safety valve for talented but poor youths to escape poverty. “The people who receive higher education tend to be relatively better off,” said Wang Jiping, the director general of the Central Institute for Vocational and Technical Education in China.”

Is China any different than other Asian countries?  If we graph income inequality using Gini coefficients against educational attainment (as represented by the Tertiary Gross Enrolment Ratio or “GER”), China does appear to be accelerating the income divide as it becomes more educated, even using official World Bank (and widely disputed) Gini figures.

Gross Enrolment Ratio and Gini Coefficients in Asia

Countries such as Korea and Japan, as well a those in Southeast Asia, seem to have grown rapidly with less income inequality and higher educational attainment, even if initial growth caused some natural inequality.  India remains behind China at the tertiary level but has, up until now, avoided the high Gini of China.  As Chinese college students are expected to double by 2030, access and affordability at high quality colleges, as well as the perception of education as a social leveler, will continue to challenge government education reform and anti-poverty programs.  

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