The quiet revolution in women's human capital and the gender earnings gap in the People's Republic of China

Using the 2010 and 2014 data from the China Family Panel Studies (CFPS), this paper analyzes the effect of human capital on the gender earnings gap, both within cohorts and across cohorts using regression, Oaxaca-Blinder, and Juhn-Murphy-Pierce decomposition analyses. On the one hand, over the past few decades, Chinese women have staged a 'quiet revolution' in education and cognitive abilities, and especially after the large-scale higher education expansion since 1999, women have outperformed men in terms of entering college. On the other hand, the gender earnings gap is reducing among the 1980s birth cohort relative to older cohorts (the 1960s and 1970s birth cohorts). Despite the advantages in terms of education and cognitive abilities of younger women, as well as a higher rate of returns on education for women, the gender earnings gap is still large: 20%-30%. When exploring the effect across cohorts, we find that the gap effect (discrimination and unobserved skills) accounts for more than 50% of the change in the gender earnings gap across cohorts. These results imply that labor market discrimination is the main barrier to narrowing the gender earnings gap in the People's Republic of China.