Elite education vs mass schooling: Why China is a bigger economic powerhouse than India

The world’s two most-populous nations, China and India, started opening to the global economy around the same time in the early 1990s. Both achieved rapid economic growth and lifted hundreds of millions out of poverty, yet today, China’s per capita income, adjusted for purchasing power, is more than double India’s. What factors explain this divergence?

China and India took distinct approaches to globalization, writes Andy Mukherjee in a Bloomberg Opinion column. China aimed to become the world’s manufacturing hub, progressing from toys and electronics to electric vehicles and semiconductors. India, on the other hand, focused on service industries, particularly software. Their population dynamics also differed: China’s one-child policy led to a youth surge and accelerated its transition toward high-income status, but it now faces an ageing population. India’s younger population is now entering the workforce, though it lacks sufficient jobs outside of agriculture to absorb this demographic.

Political systems differ too. China is a single-party state, while India is a multiparty democracy with vibrant electoral politics.

How educational paths diverged

These are the conventional explanations. But a new paper, *The Making of China and India in the 21st Century* by Nitin Kumar Bharti and Li Yang, suggests a deeper factor: the countries’ educational trajectories over the last century, says Andy Mukherjee. Examining official reports and records dating back to 1900, Bharti and Yang compiled data on what was taught in each country, how long students stayed in school, and what subjects they pursued. These divergent educational paths may have significantly impacted each country’s human capital and productivity.

Their findings reveal that, at the start of the 20th century, India had a student population eight times larger than China’s, benefiting from earlier exposure to Western education. China began catching up after abolishing the imperial examination system in 1905, which marked the end of Confucian education. By the 1930s, enrollment levels in China and India were similar.

Secondary schooling, college education

During the 1950s, the new People’s Republic of China maintained steady educational expansion, even ensuring secondary schooling continued through the turmoil of the Cultural Revolution (1966-1976). However, undergraduate education did suffer during this period. By the early 1980s, India’s college enrollment was five times that of China. By 2020, the trend had reversed, with China enrolling a larger share of its young people in higher education.

Historical circumstances influenced these paths. China’s Qing dynasty rulers in the late 19th century sought practical skills to support military industries, while British colonial rule in India focused on producing clerks and low-level administrators rather than developing manufacturing skills. Access to education and government jobs was limited to wealthier Indians, which shaped the system even after independence in 1947 when India invested heavily in elite tertiary institutions over foundational skills like reading and math.

India’s education strategy prioritized higher education for a select few, while China implemented a “bottom-up” approach, starting with primary education for a broad base and gradually expanding access to higher levels. By the 1960s, half of Indians born in that decade were likely to remain illiterate, compared to only 10% in China, according to Bharti and Yang’s study.

Social sciences vs engineering, science and vocational education

A stark difference emerges in college majors as well. Historically, India has produced more social-science graduates, while China shifted away from humanities, law, and business in the 1930s, emphasizing engineering, science, and vocational fields.

This educational divergence may have contributed to economic growth disparities. A 1991 study by economists Kevin Murphy, Andrei Shleifer, and Robert Vishny noted that fast-growing economies benefit from producing more engineers than lawyers. While India is often seen as a “land of engineers” due to its tech-industry leaders, Bharti and Yang suggest that China’s higher share of engineering graduates and comprehensive primary and secondary education prepared its workforce for manufacturing.

In the early 1990s, both nations embraced market-oriented reforms. Deng Xiaoping’s 1992 tour of southern China signalled a welcoming stance towards Western investment, without compromising the Communist Party’s control. Meanwhile, the then Indian finance minister Manmohan Singh launched India’s economic liberalization, declaring that the country would become a major player on the global stage.

Yet the legacy of India’s colonial education system, with its focus on an elite, persists. A telling statistic from Bharti and Yang’s paper highlights the contrast: in 1976, China had 160 million adults in education programmes, compared to just one million in India. Educating those 159 million people in basic literacy and numeracy may have been a decisive factor in China’s economic success.

Photo by Yan Krukau from Pexels (For illustration purposes only)