Does Welfare Participation Affect Adolescent Educational Aspiration? Evidence from Panel Data in China

Adolescents from poor families tend to have low educational aspiration, which has become a new perspective for explaining intergenerational transmission of poverty. Various types of welfare programs have been developed to address poverty as well as its negative outcomes for children. Using national longitudinal survey data from the China Education Panel Survey and a combination of propensity score matching and difference-in-differences (PSM-DID) methods, this paper pioneeringly examines the association between welfare participation and adolescent educational aspiration in China and explores the potential mediation mechanisms in this relationship. We not only focus on Dibao but also investigate the impacts of the combination of Dibao and educational subsidy. Overall, we find that welfare participation had negative effects on adolescent educational aspiration for those receiving Dibao only, but it showed positive effects for those receiving Dibao and educational subsidy simultaneously. Heterogeneity analyses reveal that the negative effects of receiving Dibao only was larger in rural areas and among those studying in non-key schools, while the positive effects of receiving both Dibao and educational subsidy were smaller among these subgroups. Pocket money per week, attending remedial class, frequency of communication with parents, and attitude about school life were important mediators in the relationship between welfare participation and adolescent educational aspiration. Findings from this study suggest important policy and practice implications for the welfare programs in China as well as around the world.