UC Santa Barbara

This dissertation consists of three essays. The first essay documents an empirical study of how the growth of imports from China changes post-secondary education decisions in Korea. As China has become “the world's factory'', the availability of low-skilled jobs has become worse in countries that import products from China. I exploited cross-industry and cross-local labor market variations in import growth from China to investigate how Korean students' post-secondary education decisions were influenced by more intensive import competition from China. Using administrative statistics from high schools between 2000 and 2015, I found that in regions more affected by Chinese imports, more students pursued a college degree after finishing high school. Consistent with the enrollment pattern, I found that in Korea, a surge in Chinese imports caused huge job losses, especially for low-educated workers, which decreased the opportunity cost and increased the marginal benefit of a college education. However, there is heterogeneity in the enrollments based on gender and type of educational institution. In the more affected regions, male students tended to enroll in 4-year universities rather than 2-year colleges, while female students were more likely to choose 2-year colleges. The findings of this study suggest that negative social norms and smaller employment losses for working women led to a more limited increase in educational investment among women.

The second essay recounts an investigation into how parents change child-related investments in rural China after introducing a pension program that provides them with an alternative to adult children as a source of support. Exploiting regional variation in the timing of the New Rural Pension Scheme (NRPS) in China, I found that parents who enrolled in the NRPS spent more on their children's education. Specifically, the increase in educational spending is observed for the parents of sons. In terms of the number of children, although the effect on the probability of giving birth to a baby is not statistically significant, I found that parents enrolled in NRPS were more likely to give birth to a boy. Considering the introduction of a pension scheme as lowering the price for future incomes, this implies that the income effect is more significant than the inter-temporal substitution effect leading to higher investments in their children. Moreover, these results suggest that NRPS does not weaken son preference in China, although this program can provide old-age support for parents instead of sons who traditionally did this.

The third essay revisits literature estimating the effect of unilateral divorce law on the divorce rate with US panel data. This literature could not have a consensus on the impact of this law on the divorce rate because two-way fixed effects and event study regressions are not robust to heterogeneous treatment effects. In this case, estimates cannot be interpreted as a causal effect. By using alternative estimators to address this issue (e.g., de Chaisemartin and D’Haultfuille 2020),I found that the divorce rate rose after the adoption of this law, and this rise reversed afterward. The average of the dynamic effects is smaller than previous papers found.