1. Understanding Educational Investment Decisions in Low- and Middle-income Settings
- Author
-
Yuan, Fei
- Subjects
- Economics of education, Education policy, Educational investments, Low- and middle-income countries, Program evaluation, Randomized controlled trial, Educational evaluation, Economics
- Abstract
This dissertation consists of three papers. In each paper, I use applied econometric methods to study the factors affecting educational investments in low- and middle-income settings. The findings provide insights into how to better support students and families in the decision-making process from a policy perspective, facilitating them in making informed choices and realizing the full potential of the investments. In the first paper, I examine high school students’ expectations about their intended college majors in rural China. I find that students hold a high level of uncertainty about their choice of college majors. Using a randomized controlled trial, I demonstrate that access to information on disciplinary knowledge and career opportunities of college majors increases students' certainty about their choice by 0.15 SD. However, the intervention reduces female students’ likelihood of choosing a science major by 10 percentage points. I provide evidence that the effect is not driven by students’ perceived ability in math. The findings suggest that preferences for college majors are formed as early as the first years of high school, and gender-sensitive approaches are needed to cultivate interests in science majors. The second paper explores how parents make decisions regarding the number of tutoring hours for their children. Through a field experiment conducted among Chinese middle school parents, we demonstrate that parents' investment decisions are affected by their beliefs about their peers' investment levels, and that they often hold biased beliefs about those levels. When provided information about the actual distribution of tutoring hours invested among their reference groups, parents adjust their investments accordingly. Our heterogeneous analyses suggest that one driver of investment in private tutoring is the fear of falling behind. The third paper estimates the effect of an economic crisis on school choice in Colombia. We find suggestive evidence that a one-percentage-point increase in recession intensity (or decrease in GDP growth rate) leads to a decrease in the number of test takers by 0.7 percentage points in private schools compared to the years before the recession. We also find a 1.2 percentage-point difference in the effects of private and public schools on the number of test takers. Our estimates suggest that families adjust their educational investments after a recession by withdrawing their children from private schools. Such changes could have important implications for students in both types of schools.
- Published
- 2024