eThesis - School of Business electronic theses

This thesis studies whether there has been genders differences in how the one-child policy has affected human capital and income in urban China. Because of the widely documented boy preference girls may be at a disadvantage in larger families, as more resources may be devoted to boys. As the one-child policy has decreased fertility, more girls have been born in families where they have few to no siblings to share resources with. Therefore, it is reasonable to assume that these girls have benefited more from the one-child policy.

This thesis attempts to answer three research questions. Firstly, this thesis studies whether there exists a trade-off between the quantity and quality of children under the one-child policy as suggested by the theoretical quantity-quality model. Secondly, this thesis explores if there has been gender differences in the effects of the policy on human capital measured by educational and health outcomes. Thirdly, this thesis analyzes if these differences have translated into income.

The theoretical framework of this thesis builds upon the quantity-quality model of children developed in the 1960s and 1970s by Becker (1960) and his successors. The model suggests that an exogenous decrease in the quantity of children should lead to an increase in their quality measured in the literature usually by educational and health outcomes. This trade-off may have been more pronounced for girls as their initial quality has been lower than boys'.

The data used in this thesis is derived from waves 2008 and 2009 of the Longitudinal Survey on Rural Urban Migration in China (RUMiC). The sample consists of urban individuals of Han majority born in 1972-1978. The principal estimation method is differences-in-differences with males as a control group for females because of the assumption of more beneficial effects for the latter compared with the former. The cohorts born in 1976-1978 form the "after" group and the cohorts born in 1972-1975 the "before" group because of the suggested birth interval of four years of the family planning policy preceding the one-child policy.

The results of this thesis suggest that the one-child policy has increased the years of education by up to 0.48 years more for females of all birth orders and by 0.95 years more for first-born females compared with respective males. On the contrary, no differential effects between the sexes were found on health outcomes. The results also showed that the one-child policy has affected the income more positively for females than for males. The increase has been 18% more for females than for males among all birth orders and 33% more for first-born females. This increase has occurred most convincingly through the channel of increased educational attainment. These results provide evidence that the one-child policy has indeed benefited females more than males and decreased the gap between the sexes in educational attainment and later in life in income.