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College Expansion and Heterogeneous College Premiums: Evidence from the Marginal Treatment Effect in China

  • Weibo Yan EMAIL logo and Kezhong Zhang
Published/Copyright: September 16, 2025

Abstract

This paper employs a heterogeneous education return framework to estimate the marginal treatment effect of college expansion on college premiums in China. Our findings are threefold. First, we capture heterogeneous college premiums after college expansion, especially in urban areas and provinces with abundant educational resources. Second, the treatment effects follow a quantitative sequence of ATT (Average Treatment Effect on Treated) > LATE (Local Average Treatment Effect) > ATE (Average Treatment Effect) > TNT (Average Treatment Effect on Non-Treated), which reconciles the puzzle that instrumental-variable estimates are always larger than OLS estimates in the literature. Third, we demonstrate that policies designed to increase the college entrance probability by a proportion will lead to groups with lower college premiums attending college, which is ineffective compared to those equalizing educational opportunities. This paper furthers our understanding of education premiums and sheds new light on the quality mechanism governing the impact of college expansion on college premiums.

JEL Classification: I23; I28; J31; J08

Corresponding author: Weibo Yan, School of Public Finance and Taxation, Zhongnan University of Economics and Law, Wuhan, China; and Innovation and Talent Base for Income Distribution and Public Finance, Zhongnan University of Economics and Law, Wuhan, China, E-mail:

Funding source: National Natural Science Foundation of China

Award Identifier / Grant number: 72503251

Funding source: National Social Science Fund of China

Award Identifier / Grant number: 24VRC090

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Received: 2024-08-26
Accepted: 2025-08-27
Published Online: 2025-09-16

© 2025 Walter de Gruyter GmbH, Berlin/Boston

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