The Income Distribution Effect Of Urban-Rural Inequality In Education: A Theoretical And Empirical Analysis

In terms of the fact of uneven income distribution, this paper argues the differentials in the rates of return to schooling between urban and rural play an important role in enlarging the gap of income distribution. Using the latest survey dataset, we estimate the rates of return to schooling on the base of the basic Mincer-Type earning function for urban and rural labor, respectively. We find that on the whole the rates of return to schooling in China are increasing, but it's still low. We also find there is a great gap between urban and rural labor's return to schooling. This paper argues more inputs to rural education, improving rural education quality radically and universalizing compulsory education are necessary to reduce the trend of polarization in income distribution and ensure sustainable growth.