Higher education expansion, economic reform, and the change of college wage premium in urban China (1986–2019): An age-period-cohort analysis

This study utilizes three large-scale survey datasets and multiple APC models to analyze the trends of the college wage premium in urban China across different temporal dimensions. The findings reveal that the economic returns to higher education increase continuously with age. In addition, the period effect also demonstrates an upward trend, which is attributed to the rapid economic modernization and market-oriented economic reform in urban China. Furthermore, the cohort effect declines significantly in cohorts born after 1980, primarily due to the rapid increase in higher education enrollments after the massive university expansion policy in 1999. It is suggested that scholars should focus on age, period, and cohort trends simultaneously and explore their driving forces when studying countries where economic reform and higher education expansion concurrently exert significant effects on the change of economic returns to higher education.