An Economic Analysis of Sex Bias in Children's Human Capital and Women's Fertility in Rural China

Both theoretical and empirical analyses of the effects of parental sex preference on children's human capital and women's fertility are conducted in this thesis. The theoretical analysis shows that, under certain conditions, the revealed sex preferences in children's human capital and women's fertility are unambiguously consistent with the unobserved sex preferences underlying them. The theoretical analysis provides suggestive guidance for the explanation of sex preference in China. The empirical study is the first micro-economic study to examine the effects of parental sex preferences on both children's human capital and women's fertility in rural China. The data come from the rural samples of the China Health and Nutrition survey (CHNS). With regard to children's human capital outcomes, I find that as age increases, female children's disadvantage in schooling-for-age becomes more and more prominent. Meanwhile, there is no significant gender differential in children's height-for-age. I also find that female children's human capital outcomes are sensitive to more factors than are male children's. In particular, female children's human capital outcomes benefit from having mothers with better income potential. Such effects are not significant for male children. According to the estimates, other things unchanged, if mothers' average income potential increases by 2.6 standard deviations from the current level, the average years of schooling for 18-year old rural girls would be 9 years, the mandatory educational level required by the government. Other things unchanged, every one standard deviation increase in mothers' income potential can result in about 0.2 standard deviation improvement in female children's height-for-age. With regard to the effect of sex preference on women's fertility, I find that if the overall proportion of sons is high or the first child is a son, the total family size is smaller. I also find that, for a woman, if the proportion of sons is high or her first child is a son, the probability of her birth progression to the next parity is lower. According to the estimates, among every one million "extra" children (a second or higher order child) in rural China after 1979, about a quarter million were born due to the parental sex preference. Even though not fully conclusive from the theoretical point of view, a son preference is suggested by these findings.

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