Association for Public Policy Analysis & Management

Children’s education is one of the primary concerns of parents. One of the most important decisions parents make is whether to enroll their children in school at a younger age. Early enrollment could reduce one year’s monetary and time cost from child care. What matters more is the casual mechanism induced by studying at a younger age, which may promote children’s development in the future. In this paper, we focus on the effect of school entrance age on the long-term labor market outcomes, since eventually all the short-term effects, such as educational attainment, will work towards the results on labor market. Particularly, we employ the regression discontinuity (RD) design by utilizing the natural cutoff date created by the 1986 Chinese Compulsory Education Law.

There are limited numbers of studies regarding labor market outcomes in comparison with those on educational attainment, and mixed results are found. For the U.S. education environment, Angrist and Krueger (1991) and Mayer and Knutson (1999) find that children enrolling at a younger age could have higher eventual wages; while Dobkin and Ferreira (2010) document no statistically and practically significant effect. As for other countries, Black et al. (2011) find starting school older leads to a negative impact on earnings for workers in their 20s in Norway. Two more recent papers by Zweimüller (2013) and Pehkonen et al. (2015) look at the effect in Austria and Finland respectively. The former paper claims that the younger students earn less, while the latter one argues that there is no such relationship.

In China, the school entrance age is set by the 1986 Compulsory Education Law. It is required that any children who have reached the age of 6 should enroll in school to finish the nine-year compulsory education. The threshold date is August 31 in the corresponding school year. Thus, children who are born after August 31 in a calendar year are normally forced to postpone their primary school entrance to September of the next year.

To conduct the analysis, we use the dataset from the China Health and Nutrition Survey (CHNS) and Chinese Household Income Project (CHIP), both of which provide the exact day of birth for each individual. The empirical design takes advantage of the threshold date in Compulsory Education Law as a source of exogenous variation in the timing of school entrance. The RD design lets us estimate the school-earning relationship, by comparing individuals who are similar in other attributes, but enter school at different ages on account of the school entry law.

To our knowledge, this paper is the first one to use school entrance age required by 1986 Compulsory Education Law as threshold to estimate how school entrance age could influence long-term labor market outcomes in China. It could contribute to the current research gap and provide guidance for parents and legislators on school enrollment decisions. Another contribution is that this study estimates the effect on long-term labor market outcomes, which are of great interest besides intermediate outcomes such as academic performances.