The Impact of Fiscal Education Expenditure on Household Education Expenditure in China

Abstract

Education is always a hot topic in China attracting attention from many scholars, and the particularity of education frequently contributes to contradiction between education’s personal return and the social one. Therefore, to achieve common and equal development in educational development, macro control on education resources is of great importance. Learning the impact of fiscal education expenditure on household education expenditure can help in building a better understanding of the mechanism behind the effect of increasing or decreasing fiscal education expenditure, so that the government can set educational policies of higher efficiency. What’s more, merely understanding the general impact of fiscal education expenditure is far from enough. More factors, i.e., household income, educational stages, should be taken into consideration because different groups of people may have various reactions to the government’s macro control.  Based on the secondary data collected from CFPS, an authoritative database in China, together with the primary data collected through the distribution of questionnaire, the researchers built three OLS regression models, and carried out certain data analyses, finally drawing the conclusions that the fiscal education expenditure plays the crowding out effect on the household one, and both income and educational stages have significant impact on this crowding out effect.