How Does Family Educational Investment Depend on Children’s Academic Ability? An Experiment on Information Shocks

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Abstract

This study uses randomized information shocks as an exogenous factor to examine how children’s academic ability impacts education investment among multi-child families. To test this, we conduct a large-scale randomized controlled trial (RCT) in 3,750 households with two children enrolled in 4th to 11th grades in rural China. Half of households (N=1,878) are assigned to the treatment group in which children’s test scores are provided. In contrast, households in the control group are not provided with this information. Subsequently, we evaluate how the household and children’s characteristics moderate the causal relationship between children’s ability and family education investment. Furthermore, parents’ resource allocation strategies when they face different levels of stakes in educational decisions are examined.

Authors

• Xinjie Zhang, Vanderbilt University

• Yi Wei, Peking University

• Yingquan Song, Peking University

• Feifan Zhang, The Education University of Hong Kong