Reform Of Education System And Regional Economic Growth

The relationship between reform of educational system and economic growth is one of the topics that have been discussed by the academic circles for a long time.The study shows that education promotes long-term economic growth through human capital,R&D.China now is facing Economic transformation and Industrial restructuring.The success of transformation from "made in China" to "crate in China" heavily depends on talent pool and basic research so the reform of the education system is of great significance.In the process of the reform of the education system,it is quite important to explore the impact of various policies on the regional economy in order to provide the theoretical basis for policy formulation.The recent discussion on whether to abolish"985 project" attracts lots of attention.While we admit that "985 project" has achieved great success in building world-class universities,we also find out that the "985 project"has brought unfair distribution of educational resources which increases regional development gap.Based on research ideas of institutional economics and take "985 Project" as a case,we discuss the impact of "985 universities" on regional economic growth.The analysis consists of two parts.First we consider three channels through which"985 universities" can affect regional economic growth:research funds,R&D research,and accumulation of human capital.The conclusion is:Areas with "985 universities"can benefit from these three aspects,while areas that do not have the "985 universities"encounter funding shortage and the plight of talents.In order to prove the authenticity of the above analysis,we then select the panel data of 31 provinces in China form 1997 to 2014.Based on "quasi experimental" hypothesis,we treat the "985 Project" as an experimental intervention,then we set up a "985 universities" provinces as experimental group,provinces without "985 universities"provinces as the control group.Finally we apply DID model for our analysis.In order to improve our results,we further add capital investment,urbanization,geographical location and other factors as control variables.Also we add fixed effects and time effects in multi-period model.Final conclusions:"985 Project" as a policy shock has a significant positive impact on regional economic growth.For example,if we use real GDP per person to represent the economic growth,we can see that "985 universities" can bring about an increase of 8.9%.From the view of growth rate,"985 universities" can bring about an increase of 1%.The results of the empirical analysis are consistent with the discussion above,which shows that the "985 Project" will bring great benefits to the regional economic growth and will also widen the gap of economic development between regions.At last,we put forward some policy suggestions to alleviate unfair distribution.