Household income and child schooling in Vietnam

The stronger are the associations between household income and child school ing, the lower is intergenerational social mobility and the less equal is o pportunity. This study estimates the associations between household income and children's school success in Vietnam. The estimates indicate that these associations are considerable. For example, the income elasticity of compl eted grades is five times the median estimate of earlier studies. Moreover, this association is strongest for grades completed per year of school, not for completed grades, on which most of the previous literature has focused . There ale some gender differences, the most important being a smaller ass ociation between income and grades completed per year of school for boys th an for girls. This difference implies that schooling of girls is treated as more of a luxury (less of a necessity) than is schooling of boys. This article also investigates some ways in which policies relate to househ old incomes. School fees are progressive, but school fees are only about on e-third of what households pay directly to schools and are a much smaller p roportion of a household's total school-related expenditures, Total househo ld expenditures paid directly to schools increase with household income les s proportionately than do school fees alone, so the overall structure of su ch payments is less progressive than is the structure of school fees. Becau se school enrollment is positively related to household income, moreover, t he structure of school fees is less progressive for the entire population t han for the selected subset that has children enrolled in school. Further, the two school quality measures that have the strongest positive associatio n with children's school success are much more available to higher-income h ouseholds, meaning that higher-income households have greater school expend itures in part because they are obtaining higher-quality schooling and not because charges for the same quality schooling are progressive across incom e classes.