When Opportunity Knocks: China's Open Door Policy and Declining Educational Attainment

Abstract

In 1978, China opened its door to the outside world. This study investigates how the Open Door Policy affected the educational choices of workers born 1960–1970. Using measures of local labor markets’ export exposure, we find the Open Door Policy decreased educational attainment; youths born from 1965 to 70 facing the mean export exposure were 5.6–13.3 p.p. less likely to complete high school than those born in 1960. Our findings suggest a complicated relationship between Chinese human capital accumulation and economic growth during the industrialization of the 1980s and 1990s, as the Open Door Policy reduced skilled labor in the most export-exposed regions.