Picking up the Losses: the Impact of the Cultural Revolution on Human Capital Re-Investment in Urban China

Thursday, April 1, 2010

Using the Cultural Revolution of China as a quasi-experiment, this paper analyzes the long-term impact of interrupted education in the midst of economic transition with booming opportunities that highly reward educationalqualications. We focus on the remedial human capital investment decisions taken by individuals whose education has been interrupted by this shock. We find substantial increases in schooling levels among the adult cohorts as theyinvest in continuous education to make up for their interrupted schooling and take advantage of new opportunities aorded by the economic transition. Estimates of the educational loss caused by the Cultural Revolution that ignore subsequent re-investments would not accurately measure the  true losses in inflicted by this event.

Jun Han
Wing Suen
Junsen Zhang

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