The Economics of Teacher Occupational Choice in China

Teachers are central to improving education quality and student learning. Yet, it is common that education systems short-pay teachers. Linking the occupational choice literature, this dissertation raises concern regarding potentially large adverse effects of holding teacher wages back from broader market levels, in terms of declining teacher aptitude and reduced student learning. Using a four-part analysis, I examine and contextualize theoretical stipulations using the case of Chinese teachers. Firstly, in Part I, I establish the causal link between teachers’ human capital level and student learning outcomes, by employing student fixed-effect models to relate differences in teachers across subjects to variations in student test scores. I find statistically significant impacts of teachers holding advanced tertiary degrees on improving student learning, at 0.033 standard deviations or adding about 1 additional month of learning over a typical 9-month academic year. Secondly, in Part II, I document relative pay gaps between teachers and comparable workers using Mincer earnings function. Between 1988 and 2013, I find sharp shifts in the relative wage attractiveness in the teaching sect