Abstract:

The expansion of college enrollment, which began in 1999, accelerated the transformation of China into a country with large human resources. The upsurge of newly-established colleges has also affected the urban income distribution. Based on the college data of 278 cities in China and the nighttime lighting data, this study found that, first, with the expansion of colleges, the income disparity in inland cities with public college has been significantly reduced, and the impact of policies has a longer decay period. Robustness tests such as parallel trend test, placebo test, eliminating the factors of city size and controlling the influence of graduates’ cross-regional employment still support this conclusion. Second, compared with public colleges, the contribution of private colleges to narrowing the urban income disparity in China has not yet been revealed. Third, the accumulation of human capital, the increase in the average wage of staff and the enhancement of technological innovation ability are the internal mechanisms for the newly-added colleges to curb the income disparity. Finally, the effect of narrowing the urban income disparity with key colleges is more significant. The reallocation of higher education resources measured by the construction of first-class universities and disciplines of the world is a beneficial policy to adjust the income distribution. The above conclusions have important implications for how to optimize the spatial allocation of higher education resources, and also provide a basis for realizing the path of regional common prosperity.

Key words: enrollment expansion, undergraduate colleges, income disparity, difference-in-differences model