1. EDUCATION IN CHINA AFTER THE REFORM A CASE ON DEREGULATION OF UNIVERSITY EDUCATION Yushi MAO Unirule Institute of Economics 2007.9.4 New Delhi

2. Education prior to the reform Education is one of the pillars of proletarian dictatorship The Party controlled the appointment of school chief, approval of text books, and appropriation financial resources to education sector. Education is a department of mandate economy. Education is basically free but with limited supply, especially on high education.

3. Through Anti-right Party campaign Mao established absolute dictatorship In 1957, MAO launched Anti-right Party campaign. A half million outstanding intellectuals were persecuted, mostly university professors students and research fellows. Since then no different voice can be heard, and policy went to absurd. That led to the great famine in 1959-61, when 30 million people died, a loss of 5% population.

4. University students reduced by 93% during Cultural Revolution MAO said: University education should continue, I mean university for science and technology implying that for social sciences should be closed. University students reduced from 674 k to 48 k, a reduction of 93%. Professors were exiled to farmland, and campus were occupied by troops. The notion:Knowledge is useless prevailed in China. This is the darkest era of education.

5. As reform started, university resume to enroll students Reform began in 1978. Universities resumed to enroll students at the same year. Students increased to 1.4 million in 1984, more than double as before cultural revolution. Huge difficulty was to be overcome, in terms of accommodation, teaching staff, apparatus, library.

6. Private schools were permitted to be set up in 2002 Sole State ownership in education sector was replaced by plural ownership. Private investment entered to schools of different grade, from kindergarten to college. But the profit earned by private schools was limited to a certain amount. Private schools can hardly compete against public schools due to different financial support. Business tax and corporate income tax are exempted for all kind of schools.

7. Expansion of university admission Up to 1998, the development in high education had much lagged behind economic growth. The annual increase of university admission between 1986-1995 was 4%, while the economic growth was 10%. In 1999 government decided to accelerate university admission.

8. In million University admission students

9. Expansion produced a more equal education opportunity In 1998 admitted students from rural areas were 0.4 m. or 37% of total admission. In 2004 admitted students from rural areas increased to 2.3 m. or 51% of total admission. Rural students usually are from poor families. So there is an improvement on education opportunity.

10. Quick expansion lowered the quality of high education Admitted students have increased as the required admission standard was lowered. Universities cannot follow such a quick expansion in terms of teaching staffs, accommodation, apparatus, and library. The result is a quality declination. Universities paid great effort to improve quality, by inviting better professors,etc.

11. Expansion enlarged senior middle schools 10 years prior to expansion, growth of senior middle students was 2.3%; growth of graduates was 0.05% 7 years after expansion growth of students was 15%; growth of graduates was 14%. Graduates from senior middle schools were 2.5 m. in 1998, and increased to 6.6m. in 2005. University admission rate increased from 43% 1998 to 77% 2005.

12. in million In million Students(red) and graduates (blue) from senior middle schools

13. Effect on postgraduate schools Admission of postgraduate students increased from 73 k in 1998, to 365 k in 2005, with an annual growth 26%. During the period 1991-1998, the annual growth was 13%. The students who got a degree increased from 47 k in 1998 to 190 k in 2005, averaged growth rate was 22%, while the growth rate was 12% during 1991-1998.

14. Graduate students (blue) and students who got a degree(red) (in thousand)

15. Education level is still low Education expenses among public finance in China is 3.2%, the same level as that in India. But Chinese families pay much money in children education. Education level is low as compared with developed countries.

16. Education level of population with the age 25-64 in % country Below junior middle school Senior middle school universityAverage years of education USA(1999) 135235 12.7 Japan(1999) 19503112.6 UK(1999) 18572512.5 Germany (1999 ) 19582312.3 Korea(1999) 34432311.5 China(2001) 8213 5 8.0