Has Industrialization Harmed Child Health and Education in China?

Wei-Jun Jean Yeung, New York University and National University of Singapore
David I. Levine, University of California, Berkeley
Lingyun Nie, University of California, Berkeley
Bernard Yeung, New York University
Yaohui Zhao, Peking University

Industrialization is often equated to income and job growth, improved living conditions and generally social development. Recent research casts doubt on a straightforward positive relationship between industrialization and development. Since economic reforms began in 1978, China has experienced unprecedented industrialization and income growth. It remains unclear, however, whether this rapid industrialization has improved social outcomes that are important for sustaining long-run development. We examine the impact of industrialization on the development of children’s health and education in China. Our approach is to analyze micro-level data collected in the 1990 and 2000 Censuses from roughly 2,000 counties and the socioeconomic indicators in industrial surveys. We predict individual-level child outcomes using family characteristics, time-varying district characteristics (such as percent manufacturing), year effects and county fixed effects. Regional and time variations allow us to conduct instrumental variable estimations to examine the effects of manufacturing with and without foreign ownership on investments in children.