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Ruixue Jia et al., "The Highest Exam: How the Gaokao Shapes China" (Harvard UP, 2025)
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Peter Lorentzen
Welcome to the New Books Network hello and welcome to New Books in Economics. I'm Peter Lorenson, Associate professor of Economics at the University of San Francisco. My guests today are Rei Xue Jia and Hongbin Li. Rei Xue is Professor of Economics at the School of Global Policy and Strategy at the University of California, San Diego, where she co directs the China Data Lab. Hongbin Lee is Co Director of the Stanford center on China's Economy and Institutions, as well as Senior Fellow of the Stanford Institute for Economic Policy Research and the Freeman Spogli Institute for International Studies. He was previously professor of Economics at Tsinghua University in Beijing and at the Chinese University of Hong Kong. Today we'll be talking about their new book, the Highest how the Gaokao Shapes China. Because I know Hongbin and Racetray and their research, I knew it would be a very insightful and well informed book. But I'm happy to state that on top of that, it's very engaging and well written. It weaves together stories from their own lives as students who lifted themselves up in China by success at this exam, along with the academic research by economists and others to understand kind of the role of the exam in China's society and what the exam can and this exam system can tell us about China's governance and economy more broadly. Rixie Hongbin, welcome.
- [02:18]
Hongbin Li
Thank you, Peter.
- [02:19]
Rei Xue Jia
Thanks Peter.
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Peter Lorentzen
So Rei Xie, why don't you start us off by just telling us what the Gaokao exam is, how it works?
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Rei Xue Jia
Sure. Gaokao is the national college entrance exam. It takes place in Zhu, usually last two or three days. It's really a national level tournament on those two or three days. If you can measure the noise level of China, I think the country would become a bit quieter because everyone pays attention to this exam, trying to provide good environment for the young students. Last year 13 million high school students took this exam and this is the only way within China to be admitted to colleges of different tiers. And the score is crucial and the single score would determine whether you can go to a college, which is not too difficult nowadays to go to a college. We can talk about that a bit later. It's more difficult to go to the elite college and within the elite there different tiers. So it kind of matters in family's belief that, oh, this would shape the life and career path of their children. And Gaokao is the, you know, one of many, many exams the young Chinese would experience in their life. So we pick this, as we call it, the highest exam, which is a literary translation of Gaokao as the title of the book. But the core of the book is more about the whole education system as exam system. What's special about such a system? As we know, education is important in every country. So what's special about the Chinese education model? That's the purpose of writing this book.
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Peter Lorentzen
Right. And so every student, anyone who wants to go to any college in China on just a couple of days in June is all going to go into these testing rooms and do a very, very long multi part test and whether they get accepted into college or not or a good college, a bad college or maybe no college at all. Depends just on how they did that couple of days. Nothing to do with their extracurricular activities or essays they've written or what their grades in high school are, is that right?
- [04:42]
Rei Xue Jia
Right.
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Peter Lorentzen
And so everything's kind of riding on this one exam.
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Hongbin Li
Yes, yes. So actually I did a talk two days ago to a group, local Americans. So one question is like how do you compare Gakao to American SAT test? So my answer is very simple. So if you think about basketball game, Gaakao is like NBA tournament and SAT is like American middle school basketball tournament. So that's the difference.
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Peter Lorentzen
It's much less intense. And also, you know.
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Hongbin Li
Yeah, a lot of guys.
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Peter Lorentzen
Yeah, yeah. And also the gaokao. Yeah. Because it's the only thing that matters. So that really, like, you know, a good SAT is helpful, but.
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Rei Xue Jia
Yeah, yeah. To add to Hongbing's point is one argument we want to deliver through the book is that the Chinese education system puts a lot of emphasis on selection, right? Is to select the people either based on their intelligence or based on their diligence. So in that why, it's related to the fact that Gaoka is very difficult to really have an effective selection function. By design, you want to have a difficult exam, right? If it's not so difficult, then this selection function wouldn't be that effective. I think that by design is supposed to be a difficult test, right?
- [06:01]
Peter Lorentzen
So you don't want to have sort of a great inflation scenario where everyone who's reasonably smart gets an A and then we just kind of pick and choose among them. You want to actually, even among the people who would be the A students, anywhere you want to find that top 1% and the top 1% of the 1%. And, and so, you know, this is just high school, Right. So what about the rest of their lives? Right? You know, you can, you can always. Some people are slow starters or, you know, things happen differently in their lives. How does that work?
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Rei Xue Jia
Yeah, as you know, Peter, like FIFA in China already started thinking about this final tournament when their children was very young, right? Even in primary school. And that's because, you know, to, to be successful in this exam is you need a lot of investment, right? So you'll think about, oh, your children should go to a good high school. And to enter high school, it's better to have a good middle school. And to do that, it's better to have a good, even kindergarten, right? So this tournament is so powerful because this test basically guided the whole education effort and the investment by families. So that's why it's so intense. Right. And it's also become more and more a burden to numerous families.
- [07:18]
Hongbin Li
So basically, since the test is so consequential, affects one's life in a sense, the system is very punishing for late starters. So you have to do well early on in your life. So there are fewer chances in the Chinese society compared to us that you can do well later on even if you don't enter a good college. So that's very difficult for Chinese. Yeah.
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Peter Lorentzen
So what does it mean to be from a good college in China? I mean, certainly in America, if you can say that you went to Stanford or wherever else, then that's going to carry a lot of weight with people. But in your book, you describe in China it sounds like it's even more extreme.
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Hongbin Li
It's very hierarchical. So, so in this country, if you say which university is the top? So Peter, you and I will say for Stanford, right? Other may say other names, right? But in China, there's no doubt there are two top colleges, Tsinghua, Peking University and then followed by a few others. So this is really hierarchical. So ranked from 1 maybe to 100. So in our research, Ruchi and I wrote a number of papers. So we define elite, Basically the top 100 colleges. It's about 5% admission a year. So in China and there are also other layers, like first tier colleges, second tier, third tier. And four year was a three year vocational colleges. So it's all revved by the government.
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Peter Lorentzen
And so how does getting into one college versus another affect your life after that?
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Hongbin Li
We showed that, I wrote a paper, we showed that first of all, going to college will increase your income by about 10% per year. Education basically 40% for going to college compared to high school graduate, going to elite, top 5% of China's colleges, your income will increase by about another 40 to 50%. So this is monetary income. Beyond that, going to a good college can also land you a job in the state, which can help you to earn a cool code. In a good city like Beijing or Shanghai, becoming a government official or working for state owned enterprise can also help you to get substantive housing, free medicine, and your children can also go to a good local school. So there are so many benefits even beyond monetary incomes.
- [09:57]
Rei Xue Jia
I think it's interesting to compare the Chinese hierarchy with American hierarchy. I also feel as a foreigner, I also feel the American college system is very hierarchical. There's two differences. I see. One is that the Chinese hierarchy is very centralized. It's like the whole country using exactly the same hierarchy. Everyone knows which tier the university is. And within the elite, this elite among the elite, et cetera. I think the American system is also very hierarchical, but it's a bit more decentralized, right? This local, like this flagship universities are very well recognized by the regional labor market. I think China is a bit more extreme in having this centralized hierarchical system. Another interesting contrast is American system is a mix of public and private university, right? You can imagine if you rely only on market, especially the private market, naturally they'll be forming a hierarchical system. What's a bit strange is the Chinese case, because Chinese colleges are publicly owned, right? In principle, the more similar cases, the European counterpart, like German system, those kind of has more like public university, but they are very flattened, relatively Speaking Right. Whereas China as a public system, yet it's created this very hierarchical structure which I think is worthwhile thinking that at this stage that the ideal system for the country.
- [11:41]
Peter Lorentzen
Sorry, you're saying that that's intentional, like that is the ideal system or you're saying it might not be, but they're sort of in the habit. Like how did it become so hierarchical? Why do you think? I don't know the German case at all. But yeah, what is it that you think has exacerbated that?
- [11:58]
Rei Xue Jia
I think this system from the state governance perspective is intentionally designed. But this system has its benefit and cost side, right? Like the benefit side because it's hierarchical. Everyone wants to invest more in such a system so that their children could go to a slightly better college. Like one point would change the life of my children. Whereas, you know, this is the college entrance exam has a maximum score of 750 points, yet everyone feel, oh, one point matters in such a system, from the state perspective, this is not bad. Everyone works hard, invest a lot in the system, right? But from the social perspective, family perspective, now it's just like a lot of waste for investment, right? And everyone, every family invests in this tournament so that for a better ranking rather than for more learning. So I think the cost side become more and more significant nowadays with economic development now families all have some resources to invest in their children's education. So with, you know, the cost side become more significant. I think it's the time to think how to make it less wasteful. You know, that's I think a main problem of the current education system in China.
- [13:27]
Peter Lorentzen
Well, so I mean, how is it wasteful if they're learning, you know, good stuff that they should be learning? I mean, one of the complaints in the US is that you have, you know, high school students trying to create a startup or a non profit or you know, pick up a hobby like you know, lacrosse, some sport that no one else does and get good at it just so that they can put a feminine or college application and be distinctive. Whereas like if you say, you know, in China they're just getting really, really, really good at math and, and writing, you know, or learning a lot of history, you know, to some extent. I mean, you know, I'm an academic, you know, but I feel better about them spending a lot of time doing that stuff than, you know, trying to do. I mean, obviously sports, you know, sports, music, all these things are great to do it for the love of it. But like is the admission to Stanford being dependent on doing this esoteric sport or having an instrument that no one else in the band has this year, is that really the best social allocation of effort?
- [14:22]
Rei Xue Jia
Yeah. I'm not saying that the US system is better. I'm not saying that the Chinese system is now in our time, say if you are in primary school, you learn this level of math, like a relatively basic level. And now the young kids indeed becoming much better at the same age because they learn middle school math. This intensified people learning things earlier and earlier. But there's a boundary, like what they learned is for the college entrance exam test, right? It's not that there's the knowledge becoming more, it's just they learn it more earlier and learn a bit better within that boundary of knowledge. So that's why it's wasteful, right? If this effort could be better spent in learning a bit more new things, that could be counterfactual outcome better for the whole society. Not only that, it's wasteful in terms of family resources now it's like tutoring is a must, it's a necessary good because everyone wants to learn things a bit earlier. So I just talked with a friend of mine who is also a professor economics in elite university in China. And he also has to send his daughter to the territory, right? Even though he hates this, but he has to, because if not, then his daughter would lag behind in the classroom because everyone learned it a bit earlier, so the teacher would go a bit faster. So that's the current equilibrium of why this is a tournament. Ultimately it's a zero sum game. If it's a positive sum, then it's good. But this is by design, it's a zero sum game.
- [16:04]
Hongbin Li
I think there are two dimensions of this point. So one is of course you can learn new stuff, you can learn, but the problem is that you have to repeat it. So learning something is different from training for a test, right? That's a different thing. So you have to repeat the thing again and again to really become really skillful in testing. The second dimension is compared to us, of course, you have to do a lot of things to get into college. Students here are even more stressful than people in Haidi in China actually. But difference is that here is more diverse actually. You can do lacrosse, you can do basketball, you can do music, you can do startup. I mean, you can do many different things actually. And also here you have more time to socialize with kids, with other kids. In China, students just focus on casting itself. So that could be something kind of we call waste of resources, okay?
- [17:07]
Peter Lorentzen
So maybe not. So maybe not a waste. To the extent that we think it is good to have more advanced math or a broader vocabulary or be a good writer, but maybe lower marginal benefit relative to it'd be good if they could join a club and learn to interact with other people or you know, get a little bit of exercise and fresh air or do a hobby that's maybe not perfectly academic but is still good. Good training for life and a good personal experience.
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Rei Xue Jia
Yeah, that's a good point to, to point to say this because it's, you know, it's like the cost side is like, you know, it's not only about the prior of learning to memorize all this material. It's this time you don't have any time to do anything else to think a bit beyond what's on the test. That's the cost aside.
- [18:01]
Peter Lorentzen
Okay, well, so your book has a few different sections. So you start by just talking about how the exam works, this whole kind of high pressure funnel till this one point. And then as you said, then you get sorted into whatever college and whatever level you're going to be in. But you said actually after that point then college itself ends up not being that valuable. Is that a good summary of. Tell me more about that.
- [18:29]
Rei Xue Jia
For instance, the college is valuable, but largely because of signaling effect, not like what's value added in the college system. In our own research, for instance, we find that if you say just to score one point above the elite college cutoff, you are more likely to go to an elite college and after four years of graduation you also get a better first job, which is better paid, has other benefits. Then the question is, oh, is that you learned more in college or actually it's because it's a signaling of your college reputation and also you have better in a network with your classmate, et cetera, based on all the criteria we can measure in terms of human capital, like what kind of test score they have in the graduation, like English test for instance at national level, or what kind of certificate they can get in all these dimensions one can measure. We don't find these two students who initially were very similar. It just one is one point more than the other. They were not different in all the measurable dimensions. And instead when in the surveys, et cetera, everyone would say that the elite tier matters a lot. The name itself matters a lot in the labor market. That suggests a strong signaling effect. That's also related to what I said earlier about the selection function of college. If you are employer, you look at the graduate survey you look at, oh, this student was in a very good elite college. They would infer he either was very smart or actually worked very hard. And that's how the signaling works as equilibrium. And in other people's research they were measuring cognitive ability or math skill, et cetera. Is value added in a few countries over the four years of college education. It's a bit ironic in the Chinese case there's no increase in certain dimension has even slightly decreased. This is all average effect. Right. It doesn't mean that there's a segment very good students at the right tail still learning a lot. But on average this value added in college seems to be rather limited. I think partly it's also the institution background. The Chinese college system is very harsh in entry selection. It's so difficult to take this exam to score well. But it's very relaxed in exit margin. Like the graduation rate on average would be 99% I think one year when college has 97% and that's become a scandal if everyone was promised to graduate. I think this by design creates this phenomena that pre college value added was pretty high but after college value added is very limited.
- [21:43]
Hongbin Li
Yeah, I think one thing is that the Gong card is so tough. So the kids have been doing this for 12 years even longer they are so sick of learning. Maybe so once they got to college they have freedom to choose. They choose not to learn anymore. Second, and the Chinese colleges, the quality need to improve. Other than a few top colleges, most are not so good. So they also have a policy basically everybody to graduate so that so they can graduate but they don't have to learn. Right. They are going to pass everywhere in the test. I think compared to us, a lot of kids don't graduate from college in China. They all graduate so they have less incentive to learn I think in college.
- [22:29]
Peter Lorentzen
So in the US I feel like, I mean especially like you know, places that the upper tier is. It's not so much the pressure to. I mean there's plenty of braid inflation. There's not so much the pressure to graduate is more like. But the people who are motivated, they want to be the A student as opposed to the B student. You know, if you graduate college now with a C, it's kind of understood that maybe you just kind of showed up and turned something in, but you may not have learned very much. It's pretty hard to fail.
- [22:54]
Hongbin Li
Yeah, I think GPA here still matters. So.
- [22:57]
Peter Lorentzen
Yeah, so the GPA matters. Yeah. But in China there's no GPA differentiation.
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Hongbin Li
No, it doesn't matter. That much in China.
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Rei Xue Jia
Yeah. And that's, it's so interesting that this signal is so important. Right. It's not only that GPA doesn't matter so much, but even if you do an advanced degree, like master degree, people still care about your first degree. Right. In the Chinese labor market, there exists this phenomena called first degree discrimination. So even you get a PhD, people think, look at your undergraduate degree because they think, oh, gaoka is so powerful in screening people. So even my students at ucsd, I believe UCSD is a good college. Right. But even after they get their PhD here, when they decide to go back to work in Chinese academia, sometimes they would still say, you know, I didn't do my undergraduate in Beidao or Tsinghua. This is a disadvantage for me in my future career, which is, you know, reveals, is how the market, you know, perceive this signaling.
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Peter Lorentzen
Right. So there's not so much.
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Hongbin Li
Yeah.
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Peter Lorentzen
So it's all just that one score, not so much second chances. Yeah. In the us, if you go to a less prestigious undergraduate institution, but then you do really well and then you go to a UCSD or stanford for your Ph.D. and the professors say good things about you, then everyone knows you're smart and they're not going to hold it against you that your undergraduate wasn't as famous. But, but in China, there's still a sense that that's the one thing that matters. So you also talk in your book about the role of the exam in social control and governance more broadly. We've been talking mainly about how it is for students and their families. But what else does this tell us about society or how does it affect society?
- [24:53]
Rei Xue Jia
So the exam system obviously has a long history. It can be dated back to 600 with the Imperial exam system. So from its origin, it was designed for governance rather than education. I think that function still matters today. And as a governance system, it has in some sense clever design. It gives hope to numerous families. Everyone kind of thinks, exactly, they have hope to go to elite college. Right. And to have a better life. Even though exposed, the success rate would be very, very low. Nevertheless, this exanti, this prospect of mobility is crucial. I think it gives legitimacy to the regime. And we see this from history. Right. Whenever there's big change in such a system, it's often associated with some instability in the whole society. So over the thousands of years, it's more. It's like 1400 years now, this system also becoming more and more sophisticated. For instance, like in 500 years ago in the Ming Dynasty, there was a Very preliminary version of a quota system so that every region would get some quota so that every region would have a chance. Today it's much more sophisticated quota system by province and by field, right? And that is example institutional design. Good for governance in the sense from the state perspective, even that every region would produce some talent for the states. That's useful for the balance of power. Even though the regional quota is unequally distributed, like Beijing and Shanghai has much higher quota per capita. Province like Shandong, Anhui middle province has much lower quota per capita. And the minority regions like Xinjiang, Tibet, Qinghai also have relatively high quota. From family perspective, it seems to be very unequal. But from state perspective, well, suppose you are the ruler when you design this quota system. Perhaps you also want to give high quota per capita to regions that are politically more important for the stability and governance. And that's the logic of this specific institutional design. So that's from a governance perspective also not only about political stability or the political control, it's also about economic development. With the courtyard system as example, then the government can decide which fields people should study. It's a very effective guidance. Historically, when the states wants people to, you know, use the Confucius classics to guffaw governance, then they would test the Confucian classics. And today when they need more talent, you know, in stem, then they can give more culture in STEM fields, right? And that's what's going on. If they need more people who knowing English, they can have high culture in English. So from the state perspective, it's a very useful tool. And that's as we know that China is known for producing many, many STEM talents. It's not that Chinese by nature are better at stem, right? It's more like under this institution, it's natural that to go to the STEM track. In fact, 50% of the students, college students, would be in the STEM track, which gives the country edge in this age of technology upgrading and even the US China Computation New Year, New me.
- [28:52]
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- [29:18]
Peter Lorentzen
Experian so kind of. So there are a few different things. So I think one you're saying on the social stability side, in general, it's kind of by being this, you know, roughly meritocratic system, everyone could feel like they had a fair chance. I mean, in a sense, I guess, you know, in the US we say the same thing, but not so much through education, but through the chance of, like, you know, you'll build a business or anyone can get rich and, you know, become rich and famous if you just, you know, try hard enough and maybe have a little bit of luck. But, you know, it's at least conceivable. And as long as that feels fair, people feel okay about the system, even if they personally aren't doing that. Well, then the same. And then China, it's more about. It's not about success through the private sector, but success through the exam system gives that same feeling. But then you're saying there's those quotas by region and by topic. So by topic, so that the government can decide, we don't need more poets, we need more people doing STEM so that they can develop robots or AI or whatever else, or economists, depending on the time period. And then they say, okay, there's going to be this many spots in college. And so everyone wants to go to college. They choose those spots. They choose what to train in and what to major in based on the availability of college spots. And then I guess the third thing was about the allocation to regions or to ethnic minorities. So they want to have. It's an interesting bias. It actually kind of reminds me of. I mean, we have in different ways, similar things in the US but people from Beijing and Shanghai. You mentioned, I think, that in your book, that in Fudan University, which is the best university in Shanghai and I guess the third highest ranked nationwide, about 50% of the students come from Shanghai. And that's actually a quota. So one thing I was curious about. You mentioned that a student who's from a minority or from a remote province will get a bump or have a lower standard to get into a specific university. But it seems like the same would be. If the same was. And they'd be a little bit apologetic about it. But the same seems to be true for a Shanghai student getting into Fudan. But I don't feel like you have Shanghainese people saying, well, I went to Fudan University, but actually I'm Shanghainese, so, you know, that means I'm not really that smart.
- [31:33]
Rei Xue Jia
Yeah, that's the critique of this meritocracy. Right. In that sense, many of people succeeded, but because of the system designed that way. But people would attribute their success to their own effort. Similarly, if you fail in this system, you wouldn't blame the system. You would say, oh, I'm not working hard enough or my child hasn't worked hard enough. As you know, that's the make the responsibility really fall on the person, on the individuals, rather than on the system. Right. Yeah.
- [32:09]
Peter Lorentzen
So then no one's really committed. But how come the Shanghai people? I feel like in the US there's a similar thing where, you know, if you're in the U.S. we don't give privileges to. Except for like, you know, California schools, you know, do have separate rules for their California students, for instance, because they're state funded. But like other places will give legacy preferences. But there doesn't seem to be the same, you know, there doesn't seem to be the shame in anyone about being a legacy preference or about being a Shanghainese student who had an easier bar getting into Shanghai. So it's kind of surprising by that it seems like an inconsistency.
- [32:47]
Hongbin Li
Yeah, I mean there are two largest behance. One is that Shanghai, Beijing are so important. They are China's elites. Right. So they govern the country. So that's why, I mean they have more quota. Second reason for fudai is that a lot of the funding coming from the Shanghai government of Fudan. So they do have local funding. So other than Tsinghua, I'm Peking University, their funding is mainly from the central government, but all the local universities, like Trojan University, a lot of funding from Zhejiang actually. So that justifies like admitting more local schools actually. So that's why if you're, I mean, because China Huco system, if you're born in a good province, a good city, basically your fate is different from someone like Rushui born in Shandong, which is very hard to get into a college in Shandong.
- [33:38]
Peter Lorentzen
Yeah, yeah. So that's. Yeah. For people unfamiliar with China, it's kind of you're not really a citizen of the whole country. You can't just, you know, if you're born in Shandong, you can't move to Beijing and then go to high school in Beijing without basically getting more or less a visa or something equivalent to that. So that you can now legitimately, it's.
- [33:54]
Hongbin Li
More difficult than getting a visa, by the way.
- [33:58]
Peter Lorentzen
Yeah, it's quite a different system. So you talk about this a lot in the context of China and Chinese history. I do feel like you didn't talk about this in the book. So I Don't know, you may not have looked into it as much, but a lot of the things that you've said, I've read in newspaper articles and stuff about Taiwan or Japan or Korea, the same thing like there's a massive high stakes exam and parents are laser focused on, you know, getting their students into the right college. And then once you get into the right college, your life is set and you can be lazy. So I feel like I've heard a very similar story there. So do you think. And so to an extent that it's, you know, I wonder if you could say, okay, it's all coming from the Chinese, you know, imperial exam system that like, I don't know, maybe we can't blame the current CCP alcohol system on everything because there seems to be something that's much broader in countries with different politics, different political histories are ending up with the same kind of funnel.
- [35:01]
Rei Xue Jia
Yeah. First, this certainly has a long history and I think it's even a moral framework. It's not only like an institution, as you said, it concerns in the society how people perceive what is fair. So it has this attractive side that it gives everyone a chance so that people think this is a relative fair system. And we are not intending to blame the CCP for the culture alone. That said, I think understanding the changes and the persistence in other Asian societies in the education system would be super interesting. Actually, I'm reading and thinking about this nowadays. Indeed you see changes like Taiwan is a case that experienced the changes. Right. It used to have this Liancao which is equally competitive and intense at the Gaokao system. But in the late 1990s and earlier 2000, they gradually changed the whoa. System into now they have multiple tracks and so there's this kind of exam competition is an old story. Now I'm curious what's going on. Right. I think one reason is that there's also a lot of other political changes in the society. There's a demand to change and there's also trust in the new institution, maybe to use the more holistic approach. But on the other hand, Korea is a case where it has big institutional change, Right? It also has democratization, yet the exam is still very, very intense, equally intense as the Chinese one. So I think it's not easy to pin down. Just say one change is enough. I imagine there should be multiple changes and democratization is one element, but there should also be societal collective demand for changing the whole system. So I think in Korea, maybe they are lacking this collective action for changing the system. But I still don't know enough. I'm reading this about different societies, especially in these cousins of the exam legacy.
- [37:26]
Hongbin Li
I think my observation is that beyond the testing itself, it's the labor market. So Korea and China have more equality and Japanese and Taiwan society are more equal. Actually, I'm talking about labor market more equal. So when it's actually more equal, then corporate admission or testing become less important. Basically, no matter how well I do the test, I can make pretty much same income, Right. Like in Japan. So a truck driver is similarly to professors. So in terms of income, that doesn't matter that much actually. So maybe some social status difference. Yeah, So I think more fundamentally it's how the economy is structured and how society is structured in these societies, those are very important. How important testing is actually.
- [38:22]
Peter Lorentzen
Yeah. So it's kind of driven by, not just by policy, but also how that. What are the outcomes? How much does it really matter to get into a specific college or not for the rest of your life? So you also talked about how the exam system is kind of reflected in other parts, or that thinking, I guess, which is cause and effect is maybe not totally clear. That same thinking of having a single score and being very, very hierarchical in a kind of tournament kind of structure is in other parts of Chinese life as well. Could you tell us more about that?
- [38:57]
Hongbin Li
So one example would be how the party governs China. Right? So the example is the GDP tournament. Right. The paper I wrote with Julian and also has some research in this area. So what we found is that in initial reform, so he gave the KPI to local officials as GDP growth rate. So all the local officials compete on this. So this become another. We call it centralized hierarchical tournament. We call Gaokao as a centralized hierarchical tournament. But GDP tournament is another one. Right? So because of this strong incentive, there's one single transparent indicator to compare one official to the other. So they really work hard on growing local economy. So that explains why in this unique replica system, the officials have such a strong incentive to grow the economy and why China can grow so fast. So basically that's another example in the political system.
- [39:57]
Peter Lorentzen
So kind of a way of thinking. So like in schooling, everyone's trying to maximize their one grade and that's going to determine whether they advance or don't. And then in. So for people who don't study China, I should probably explain like that, you know, the Chinese bureaucracy is sort of one big hierarchy, like a gigantic corporation, more or less. And so you're not looking to get, you know, elected to higher levels of office, you're looking to get promoted. And so you're saying that, that your research showed that if you were a government official, you know, mayor of a city or the governor of a province, then yeah, the, the one thing you wanted to do is to maximize your GDP number and then that would get you promoted to the next level. And so. So similar sort of thing of just having one number and one, one tournament, everyone's. No, no, not really differentiated themselves. They're all kind of trying to do the exact same thing, right?
- [40:47]
Hongbin Li
That's exactly right, yeah.
- [40:49]
Rei Xue Jia
I think one layer is that, as Hongbin said, it's an effective and powerful system to achieve some goal, right. Either GDP or to motivate people to work hard. Another layer is that these are rules that are relatively transparent. And in the Chinese society, as you know, power is so influential everywhere, Right. Like network connection are critical for every step. Then it's kind of to carve out a specific environment where there's a transparent rule. It's very useful because the reason that without this, what is the counterfactual for Chinese families, they are worried. Without the Gaokao system, the education system would be much more. It's already unequal, but it would be even much more unequal because people would just use their social network work to help their children. So I think the logic here is that under such big institutions where power is so influential, to set up certain specific environment so that the rule is relatively transparent gives legitimacy for many, many institutions. That's the similarity across different scenarios. Even in academia, as you know, the Chinese academia also use this type of tournament, Right? It's relatively transparent. They count your publication into different tiers and use that very, very, in some sense, rigid system for promotion. One may argue, oh, it's bad in the US we would just use more subjective evaluation. But under the Chinese institutions, if you use very subjective criteria, they're likely to be a lot of corruption and a lot of, you know, influenced by connection. Right. So that's why they chose the second best. So that's the similar, you know, logic across different scenarios.
- [42:56]
Peter Lorentzen
So you want a highly transparent objective indicator, even if the subjective indicator might hypothetically be better, but the subjective indicator is going to get so tainted by, by corruption or bias of some sort, there's just no point in even having it. Or at least that's viewed as too much of a risk.
- [43:14]
Rei Xue Jia
Yes.
- [43:15]
Peter Lorentzen
So maybe as a last thing, why don't we talk about, just. We've talked about this system a little bit about the comparisons with the US System what do you think that the Chinese university system, how do you think it should reform or what should it adopt from other countries or vice versa? What do you think that the US system might benefit from adopting from this Chinese approach?
- [43:40]
Hongbin Li
I think Chinese universities, first of all they need to have better faculty, right? So I mean, one good thing about America is that this is an immigration country, right? A lot of faculty members are from foreign countries, so they attract best talent from the world. I mean, that's really important. I think so. I mean, you think about our PhD programs, more than half the students are from other countries. So that part is so hard for China, right? So they need to be more open, more English speaking in the society for America. I think colleges are really, to me, this is the best model in the world. I don't see any other country that have better colleges in the world. But for K12 education, I think there's a lot room to change. I think at least we should have more competition in local education. We are economies, right? But if we should like parents, even if for public school system, I think we should allow parents to choose like in traditional water system and maybe more competitive salary for teachers. So link their performance, link their salary to the performance students. I think something like this can really change the local culture and school performance. The thing here is that the curriculums for most of the middle school, high school are not strict enough, not demanding enough, are not demanding enough.
- [45:21]
Rei Xue Jia
For me, I think the Chinese system is both system, I would say an American system, both are too hierarchical. So I'll talk about the Chinese system first. It's just now the fundamental problem for this very high pressure and a lot of wasteful effort and resources is because the system is too hierarchical, right? It's because as I said before, this perception that one point would change my child's life and why that is the case, it's not a wrong perception, it's not a misperception. In fact, in our research we find it matters. This can change your life. That's because the system is so hierarchical. There's a hierarchy within a hierarchy. It's almost endless. And so if you make the system a bit more flattened, right, if one point doesn't change your life, then I think that would relax this tension quite a bit. And unfortunately, in this US China, big competition under this big backdrop, the Chinese government wants to have a hierarchical education system to produce leading universities. But that said, even a few universities could get more resources, et cetera. But I think others could be a bit less hierarchical. So for instance, in this Big college expansion since 1990 to today. Each year the college graduates increase from 1 million a year to now more than 10 million a year. In this big expansion, the very top colleges haven't expanded a lot, right? The Tsinghua haven't really expanded. I think as a public system, if the government wants to change the hierarchy, it can. That's the strength of the Chinese government so far. The government realized all the problems, right. They know that there's too much pressure and the young people and their families are not too happy. And so what they did is like, oh, they're banned turturing for instance, right. As we know, this just to suppress the supply isn't effective, right? Because the demand is still there. So the turturing ban is such a case indicate then this has to be dropped off, right? Because it's actually backfire. People just do this underground. So if the government wants to change the system, I think I would suggest starting with the very basic point like just expand the merit of your college a little bit. That's just one small step to make the system a bit less hierarchical for the US system at least. Maybe. I'm from public university, not from Stanford. I also say it's too hierarchical in the sense it's like even in California, right. We used to have community college had their own function. It's a bit more diversified, right. Public university maybe a bit teach a little bit different things. But now everyone teaching the same thing and even the community college become a springboard to go to the more elite colleges. I feel it's not a very. It also creates the problem that, you know, the families perceive college as a hierarchy rather than as an education place for different skills. Right. And with all this technological change nowadays and it's worthwhile thinking how to change the US system as well. I would see UCSD feels like, oh, we are a Stanford, just with a few. We teach the same thing but just with fewer resources.
- [49:11]
Peter Lorentzen
Right.
- [49:12]
Rei Xue Jia
I think beat the initial function. You have public university, private university, have different type of university now it's too homogeneously organized in a hierarchy.
- [49:24]
Peter Lorentzen
Okay, so less hierarchy both in China and in the us. That sounds like a good note to end on. Thank you both so much for writing this great book. Again, it's called the Highest Exam. Sorry, let me say the title properly so people can look it up. The Highest Exam. How the Gaokao Shapes China. And definitely encourage reading it. It was nice. Again, you guys are academics, but you wrote it together with your co author in a way that's very accessible. So it's a lot like reading good New Yorker article, whatever. You can sit down and just read a couple chapters before bed. And also, it was really fun, actually, for me. I'd never heard about you guys. Each of your own personal stories of growing up in China. Kind of course, knowing China, I knew that you have some kind of background, but it was very fun to actually learn more about you and kind of see the personal experience of how going through that system has affected you. So thank you very much.
- [50:28]
Hongbin Li
And go Pidar.
- [50:29]
Rei Xue Jia
Thanks, Peter. It was fun.