Intergenerational transmission of education in China: New evidence from the Chinese Cultural Revolution

Abstract

This paper estimates the effect of parental education on children's education by using instruments generated by the Chinese Cultural Revolution, and further explores the mechanisms of this causal relationship. Several important findings stand out from our empirical analyses. We find a larger intergenerational persistence in education for higher level in urban areas but for a lower level of education in rural areas. The main results from instrumental variable estimation show that the nurture effect is larger and more significant for fathers than for mothers. A deeper investigation of the mechanism behind this nurture effect informs us that a father's education passes on to his children's education partly through the income channel. Another notable finding is that even after controlling for fathers’ income, parental education still has a significantly positive effect on children's education through the nurture effect. This indicates that beyond the income channel, there may exist other channels such as better home environment, which deserve to be explored in future research.