Economic Geography Analysis of Gansu Province

Economic Geography Analysis of Gansu Province

People’s Republic of China
Economic Geography Analysis of Gansu Province
Analytical Report in Support of Project Design of Gansu Revitalization and Innovation Project (GRIP) (P158215)
December 2018
Global Practice of Social Urban Rural and Resilience (GSURR)
EAST ASIA AND PACIFIC REGION
1CURRENCY EQUIVALENTS
(Exchange Rate Effective December 30, 2018)
US$1.00 = CNY 6.871
US$1.00 = EURO 0.873
FISCAL YEAR
January 1–December 31
Regional Vice President: Victoria Kwakwa
Country Director: Bert Hofman
Senior Global Practice Director: Ede Jorge Ijjasz-Vasquez
Practice Manager: Abhas K. Jha
Task Team Leader: Ahmed A. R. Eiweida
2Acknowledgments
This analytical report is produced by the World Bank Group as part of analytical underpinning of Gansu
Revitalization and Innovation Project (GRIP) (P158215). The key author of this report is Dr. Liyan Xu,
Assistant Professor of Urban Planning, Peking University, China. The team was led by Mr. Ahmed Eiweida,
Lead Urban Specialist, Task Team Leader, and included Ms. Zheng Jia, Urban Development Specialist; Ms.
Yuan Xiao, Urban Development Specialist; and Ms. Hongwei Zhao, Senior Program Assistant.
Analysis made in this report and views expressed reflect the views of the key author and not necessarily of the World Bank Group.
3Table of Contents
1Context ......................................................................................................................... 8
1.1 Introduction ..........................................................................................................................8
1.2 Overall Economic Growth in Recent Years in Gansu ............................................................8
1.3 Main Drivers of Economic Growth in Gansu.........................................................................8
1.4 Government Strategies.........................................................................................................9
2Gansu’s Economic Geography: General Analyses ...................................................... 10
2.1 Place....................................................................................................................................10
2.1.1 Location.......................................................................................................................10
2.1.2 Natural Assets .............................................................................................................11
2.2 People .................................................................................................................................11
2.2.1 Demographics .............................................................................................................11
2.2.2 Education ....................................................................................................................14
2.2.3 Labor and Employment...............................................................................................16
2.2.4 Level of Living Standards.............................................................................................17
2.3 Infrastructure......................................................................................................................20
2.3.1 Regional Transportation and Logistics........................................................................20
2.3.2 Rural Infrastructure.....................................................................................................20
2.4 Economic Development......................................................................................................20
2.4.1 Overall Economic Development Patterns...................................................................20
2.4.2 The Agriculture Sector ................................................................................................24
2.4.3 The Manufacturing Sector ..........................................................................................25
2.4.4 The Service Sector.......................................................................................................25
2.4.5 Emerging Industries ....................................................................................................25
2.4.6 Entrepreneurship ........................................................................................................26
2.5 Disparities in Gansu.............................................................................................................27
2.5.1 Overall regional disparities .........................................................................................27
2.5.2 Rural-urban disparities in Gansu.................................................................................27
2.5.3 Disparities between Lanzhou and secondary cities and towns ..................................29
2.6 Quality of infrastructure and services in the province .......................................................29
2.7 Urbanization........................................................................................................................29
2.8 Institutions ..........................................................................................................................31
2.8.1 Institutional Structure.................................................................................................31
2.8.2 Institutional Capacity ..................................................................................................31
2.8.3 Reforms.......................................................................................................................32
2.8.4 Fiscal Performance......................................................................................................32
3Gansu’s Cultural Heritage Sustainable Tourism (CHST) Development: Assets and Challenges 32
3.1 Heritage and Cultural Resources.........................................................................................32
3.1.1 Heritage Assets ...........................................................................................................32
43.1.2 Tourism Development.................................................................................................34
3.2 Potentially Sensitive Issues Concerning the CHST Development: Environmental and Poverty Alleviation Challenges................................................................................................................41
3.2.1 Environmental and Ecological Challenges ..................................................................41
3.2.2 Poverty Alleviation......................................................................................................43
4Conclusions and SWOT Analyses................................................................................ 45
4.1 SWOT Analysis for Gansu Province.....................................................................................46
4.2 SWOT Analysis for the Six Prefectures................................................................................48
Annex................................................................................................................................... 53
1. Tourist Attractions by Grades and Types (Natural/Cultural), Gansu’s Prefectures, 2015........53
2. Calculation of the Location Quotient .......................................................................................54
3. City Profiles...............................................................................................................................55
Tianshui.....................................................................................................................................55
Wuwei.......................................................................................................................................57
Zhangye ....................................................................................................................................59
Jiuquan......................................................................................................................................61
Dingxi........................................................................................................................................63
Jiayuguan ..................................................................................................................................65
References........................................................................................................................... 67
Figures in the Report
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Figure 1The Location of Gansu Province (Left) and the Gansu Section of the Silk Road (Right).
Source: Gansu Province Goverment..............................................................................................10
Figure 2 The Three Major Natural Geographical and Climate Zones of China (Left), and the Sattelite Image of Gansu (Right). Source: China Natural Geography Maps..................................11
Figure 3Gansu's Historical Population. Source: Gansu Development Yearbook, 2017..................12
Figure 4 Population Distribution by the Prefectures (left) and the distribution of ethnic minorities (right). Source: Gansu Development Yearbook, 2017 ..................................................12
Figure 5 Inter-Province Population Migration in Gansu, 1990-2010 (Left), and Shares of Emigrants by Destination Provinces in 2010 (Right) Source: The Sixth National Population Census
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Figure 6 Evolution of the Age Structure of Population in Gansu, 1953-2016................................13
Figure 7 Illiteracy Levels of the Population (Left), and Population with Various Education
Attainments per 100 000 Persons (Right) over the Past Three Decades. Source: The Sixth
National Population Census...........................................................................................................14
Figure 8 2016 Population with Various Education Attainments per 100 000 Persons in Gansu
(left) and China (right) Source: Gansu Stats, 2017; China National Stats, 2017............................15
Figure 9 Number of Graduate and Enrolled Students in Advanced Vocational Schools by Fields of Study (2015) Source: Gansu Stats, 2016; China National Stats, 2016...........................................15
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Figure 10 Number of Schools and Students in Advanced Vocational Schools 2003-2015. Source:
Gansu Development Yearbook, 2016.............................................................................................16
Figure 11 Employment by Sectors (Left), and Percent of Employment by Sectors (Right), 2010-
2016 Source: Gansu Development Yearbook, 2017.......................................................................16
Figure 12 Number of Legal Entities (Left), and Number of Employees (Rights) by Industries;
Note: self-employed agricultural works are not included. Source: Gansu Development Yearbook,
2017 ...............................................................................................................................................17
Figure 13 Income and Consumption for Urban and Rural Population (Left), and Rate of Growth
(Right) in Gansu and China, 2016 Source: Gansu Development Yearbook, 2017..........................17
Figure 14 The Structure of Household Consumption in Gansu, 2016 Source: Gansu Development
Yearbook, 2017 ..............................................................................................................................18
Figure 15 ........................................................................................................................................18
Figure 16 GDP and growth rate in China’s 34 provinces, 2017. Source: Gansu Development
Yearbook, 2017 ..............................................................................................................................21
Figure 17 Gansu’s per Capita GDP (Left), and Urban/Rural Income Gap (Right) by Prefectures.
Source: Gansu development yearbook, 2017 ................................................................................22
Figure 18 Exports and imports by Prefectures (left), and Total Exports and Imports 2010-
2016(right) in Gansu. Source: Gansu Development Yearbook, 2017.............................................23
Figure 19 Value Added by Sectors, 1995-2015 Source: Gansu Stats, 2016; China National Stats,
2017 ...............................................................................................................................................24
Figure 20 Value-added of the Tertiary Industry, Source: Gansu Development Yearbook, 2017...25
Figure 21 GDP and growth rate in China’s 34 provinces, 2017. Source: Gansu Development
Yearbook, 2017 ..............................................................................................................................27
Figure 22 Urban/Rural Income Gap by Prefectures. Source: Gansu development yearbook, 2017
.......................................................................................................................................................28
Figure 21 Urbanization Levels, 2010 (Left), and Increase in Urbanization Levels, 2000-2010
(Right) by Provinces, Source: The Fifth and Sixth National Population Census.............................30
Figure 22 Population Urbanization in Gansu and China, 1979-2017, Source: Gansu Development
Yearbook, 2018 ..............................................................................................................................31
Figure 23 Gansu’s Financial Permance, 2011-2016, Source: Gansu Development Yearbook, 2017
.......................................................................................................................................................32
Figure 24 Gansu’s National and Provincial Cultural Preservation Sites. Gansu Province
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Government...................................................................................................................................34
Figure 25 Gansu’s Tourist Visits and Tourism Revenues (Left), and Shares of the Tourism Industry in Economy (Right), 2006-2016 Source: Gansu Development Yearbook, 2017.............................35
Figure 26 Structure of Revenues from International Tourism. Source: Gansu Development
Yearbook, 2017 ..............................................................................................................................35
Figure 27 The Location Quotients and Market Shares of China’s 31 province-level jurisdictions in the Tourist Industry, 2010 and 2016 (Red Dot Represents Gansu) Source: Gansu Development
Yearbook, 2017 ..............................................................................................................................36
Figure 28 Demosteic Tourism Revenues and Tourist Visits by Prefectures, 2016. Source: Gansu
Development Yearbook, 2017........................................................................................................37
Figure 29 The Location Quotients and Market Shares by Prefectures, 2010 (Left) and 2015
(Right)Source: Gansu Development Yearbook, 2016.....................................................................39
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Figure 30 Gansu’s Prefectural GDP and Tourism Revenues, 2000-2015. Source: Gansu
Development Yearbook, 2016........................................................................................................39
Figure 31 Per Capita Revenues from the Visits Source: Gansu Development Yearbook, 2017.....40
Figure 32 Gansu’s Water Resources, as Compared to the National Average, 2005-2015. Source:
Gansu Development Yearbook, 2016.............................................................................................41
Figure 33 Gansu’s Major Pollutants, and Investment in Pollution Treatments, 2012-2015. Source:
Gansu Development Yearbook, 2016.............................................................................................42
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Tables in the Report
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Table 1 Economic Sectors in Gansu Province and the Six Prefectures in 2017 ...............................9
Table 2 Gansu Income Quintile 2016.............................................................................................19
Table 3 Basic Statistics of Health Institutions by Jurisdictions in Gansu, 2015..............................19
Table 4 Per Capita Urban and Rural Income and Consumption Expenditure Levels in Gansu
Province at The Prefecture Level in 2016 ......................................................................................22
Table 5 Conditions of SMEs of Gansu and Northwestern China, 2012..........................................26
Gansu has a weak, slow growing economy, with great urban/rural and geographical disparities.
In 2016, Gansu’s per capita GDP RMB 27643, The urban/rural income gap is big, and has been widening. From 2000 to 2017 the gap had grown from RMB 4027 to RMB19687, 3.44 times the level for the base year. Geographical disparities also prevail. Lastly, the urban/rural income disparity also has a geographical factor. The income gap forms a decreasing gradient from the southeast part of the province to the northwest part (Figure 2). ( Gansu Stats, 2017; China
National Stats, 2017)。Income disparities between different cities range from 1.8 times to 3.5 times(Table 6)。.......................................................................................................................27
Table 7 Per Capita Urban and Rural Income and Consumption Expenditure Levels in Gansu
Province at The Prefecture Level in 2016 ......................................................................................28
Table 6 Gansu’s World Cultural Heritage Sites, and National and Provincial Cultural Preservation
Sites................................................................................................................................................33
Table 7 Number of Proposed “Poverty Alleviation through Tourism” Programs in Gansu’s
Prefectures.....................................................................................................................................43
Table 9 List of National Rural Tourism Poverty Alleviation Key Villages .......................................44
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71 Context
1.1 Introduction
Gansu Province is located in the upper Yellow river basin in northwestern China and covers a land area of 450 thousand square kilometers (km2). In 2017, the province had a permanent population1 of 26.26 million, of which 12.18 million were urban residents, yielding a 46.39% level of urbanization. The Gross Domestic Product (GDP) of Gansu Province in 2017 was RMB 767.7 billion(Gansu Stats, 2018).
Administratively, Gansu Province is consisted of 14 prefecture-level local jurisdictions. In this project, six of them (Tianshui, Wuwei, Zhangye, Dingxi, Jiayuguan, and Jiuquan) are involved. Specifically, five of the prefectures (Tianshui, Wuwei, Zhangye, Dingxi, Jiayuguan) are involved as a whole, and two county-level cities under Jiuquan’s jurisdiction, Dunhuang and Yumen, are involved. As a result, in this analytical work, the six prefectures mentioned above are covered.
1.2 Overall Economic Growth in Recent Years in Gansu
Gansu is one of the least developed provinces in China, although the overall economy in Gansu has been growing fast in recent years. With 1.86% of the national population, Gansu had a GDP of RMB
767 billion in 2017, accounting for 0.9% of the national GDP. In per capita terms, Gansu’s GDP per capita was RMB 29,238 (US$4,330,) in2017, ranking in the last position among all provinces, while China’s GDP per capita was RMB 59660 (US$8836) in that year. In contrast, Shanghai’s GDP per capita was RMB
124606(US$18,453), and Beijing’s GDP per capita was 128992(US$19102). Nevertheless, the GDP growth in Gansu was 3.6% in 2017, lower than the national growth of 6.9%. In sectoral terms, the economy in
Gansu had also grown at a higher rate than the national total in 2017 except secondary sector, i.e. GVAs of primary, secondary, and tertiary sectors growing at 5.4%, -1.0%, and 6.5% respectively, higher than the national rate of 3.9%, 6.1%, and 8.0% (Gansu Stats, 2018; China National Stats, 2018.
1.3 Main Drivers of Economic Growth in Gansu
Gansu has experienced a major economy structure shift in recent years. Industries with high value added have been growing steadily and fast, while the once powerful light industries are shrinking. The shares of the three economic sectors (primary, secondary, and tertiary sectors) in GDP have shifted from
14.49: 46.84: 38.67 in 2010 to 13.85: 33.38: 52.76 in 2017 (Gansu development yearbook, 2018) and accounting for 5.5%, 6.8%, and 8.9% of the total provincial GDP respectively. On the other hand, the GVAs of power, and metal industries had decreased 3.1% and 6.6% in 2016 (Gansu development yearbook,
2017). Price of the traditional light industries had decreased by 2.6% in 2016 (e.g. petroleum and natural gas mining, petrochemical industry, chemical industry, non-ferrous metal). The total investment in the 1 Statistically, a person is defined as “permanent population” of a place if he/she resides in the place for more than six months, regardless of his/her household registration (Hukou) location.
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secondary sector had decreased by6.2% in 2016 (Gansu Stats, 2017; China National Stats, 2017). Although, in the prefectural level, differences in the sectoral structures are large (Table 1).
Table 1 Economic Sectors in Gansu Province and the Six Prefectures in 2017
China Gansu 6 Prefectures
Tianshui Wuwei Zhangye Jiuquan Dingxi Jiayuguan
Sectors(%)
Primary Sector 7.9 13.85 16.69 25.65 25.04 15.61 23.10 2.18
30.79 36.7 40.5 Secondary Sector 29.09 24.10 32.75 21.95 51.84
33.38
Tertiary Sector 50.6 52.77 52.50 45.24 50.85 51.62 54.96 45.97
Source: Gansu Stats, 2018
1.4 Government Strategies
Gansu assumes a key position in the Silk Road Economic Belt Initiative, and has announced ambitious developmental plans accordingly. The ancient Silk Road spans 1600 kilometers across the entire latitude of Gansu, making the province, especially the Hexi Corridor region, a key section of the Silk
Road. The Silk Road Economic Belt spans 24 counties in 8 prefectures of Gansu, covering 39.7% of the population of the province. The provincial government has issued a comprehensive plan to make Gansu the “Golden Section” of the Silk Road Economic Belt. According to the plan, Gansu will build more than
70,000 km roads and railways in six years, and also establish new passenger and freight lines to central and western Asian countries so as to speed up the formation of Gansu’s key transport channels with
Central Asia, West Asia, South Asia and Europe. With the improved transportation conditions, Gansu plans to promote the implementation of the six major developmental projects, which include the road interconnection project, the economic and technological exchange project, the industrial cooperation project, the creation of new economic growth pole project, the cultural exchange and cooperation project, and the strategic platform construction project. The three strategic platforms in the agenda are the Lanzhou New Area, the Dunhuang International Cultural Tourism City, and the "China Silk Road Expo" (The
Overall Plan for The Development of The Gansu Section of the "Silk Road Economic Zone).
Gansu also benefits from various central government strategies, initiatives, and programs. These include three major policy platforms: (1) the Gansu Golden Section of the Silk Road Economic Belt Program;
(2) the Gansu China Civilization Inheritance and Innovation Zone Program; and (3) the Comprehensive
Buffer Zone for National Ecological Security Program. Under these national platforms, regional economic development strategies have been issued. Key programs include the Lanzhou New District and the Lanzhou-Baiyin Science and Technology Innovation Reform Experimental Zone, among others. These strategies and programs have promoted the development of new and strategic industries, such as the 9

cultural tourism industry and environment-friendly industries, so as to provide new momentums to
Gansu’s future economic development and socio-ecological enterprises.
Gansu plans to maintain a medium-high speed of economic growth and urbanization in the next five years, such that the economy will be doubled in size from 2010 to 2020 and urbanization level rise by 15 percentage points. Gansu plans to pursue an economy growth at a medium-high speed in the next five years. On the basis of improving the balanced development, inclusiveness and sustainability of growth, the province will pursue an economy growth rate and increase of per capita income of urban and rural residents higher than the national average. At a planned average annual GDP growth rate of 7.5% and per capita GDP growth of 7%, by 2020, the provincial GDP will be more than 1 trillion yuan, and the per capita
GDP will reach about 37,000 yuan, both double the level in 2010. In structural terms, the strategic emerging industries will account for 16% of GDP, and the GVA share of the service sector will exceed 50%.
Besides, urbanization will steadily progress. By 2020, the urbanization levels of permanent resident and household registration criteria will be more than 50% and 38% respectively (The Thirteenth Five-year Plan for National Economic and Social Development of Gansu).
2 Gansu’s Economic Geography: General Analyses
2.1 Place
2.1.1 Location
Gansu is located in a center place of the five northwestern provinces of China. It had assumed a key location along the ancient Silk Road, and has maintained the locational importance until today. The province locates in China’s deep northwestern inland. A major part of the province, the Hexi corridor, has been the sole accessible land connection between China’s southeastern territories and the Central Asia for more than two thousand years. This locational advantage has ensured the province a key place in the ancient Silk Road between China and Europe, and equally, if not more so in modern times under China’s national strategy of the Belt and Road Imitative. (Figure 1).
Figure 1The Location of Gansu Province (Left) and the Gansu Section of the Silk Road (Right).
Source: Gansu Province Goverment
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2.1.2 Natural Assets
Gansu has very diversified natural geographic characters, and its main livable land areas are dry or semi-dry, barren lands. The province is located in a fringe position between China’s three major natural geographical and climate zones, and is thus in possession of very diversified land morphologies, including mountains, plateaus, plains, valleys, deserts, and gobis (Figure 2), most of which are not suitable for human living. Even in the livable areas, living conditions are usually far from amiable due to the harsh climate. Gansu has a very typical temperate continental climate. With most of the land areas having an annual precipitation of 400 millimeters or less, the climate is typically dry or semi-dry, and the land is barren and faces the threat of desertification, expect in the rare oases, which usually offer a suitable place for urban developments.
Figure 2 The Three Major Natural Geographical and Climate Zones of China (Left), and the Sattelite Image of Gansu (Right). Source: China Natural Geography Maps
2.2 People
2.2.1 Demographics
Gansu has a relatively small population among China’s provinces, majorly of Han ethnic and geographically unevenly distributed, and the population has been increasing at a lower rate than the national average since 2010. In 2016, Gansu has a permanent population of 26.10 million, ranked 22nd among China’s 34 province-level jurisdictions. Since 2010, the population has been increasing at an average annual rate of 0.32%, significantly lower than the national average of 0.50%. (Figure 3) The population is unevenly distributed, with the southeast prefectures having the highest densities. Ethnic
Han account for 90.57% of the total population, slightly lower than the national average of 91.46%.
However, ethnic minorities constitute the main population in certain jurisdictions and city districts. The Hui, Tibetan, Kazak, Yugur, Dongxiang ethics form two autonomous prefectures and seven autonomous counties. Nevertheless, the six prefecture-level cities involved in the project do not contain any of the ethnic autonomous regions(Figure 4).
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2500
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Total Population (year-end) Urbanization Rate(%)
Figure 3Gansu's Historical Population. Source: Gansu Development Yearbook, 2017
Figure 4 Population Distribution by the Prefectures (left) and the distribution of ethnic minorities (right). Source: Gansu Development Yearbook, 2017
Gansu is a province typical of population out-migration. Recent censuses in the past 30 years show that the scale of population out-migration has been fast increasing. Among the destinations of the emigrants the top five province-level jurisdictions are Xinjiang (21.6%), Beijing (9%), Inner Mongolia (8.9%),
Guangdong (7.8%), and Shaanxi (6.6%), demonstrating a clear economic opportunity-oriented population out-migration, i.e. the emigrants flow either to relatively more developed nearby northwestern provinces, or to the absolutely more developed southeastern provinces and the national capital (Figure 5). (The Sixth
National Population Census)
12 350
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311.27
Xinjiang,
21.6
Other province s, 33.8
159.33
43.28
155.69
Beijing, 9
58.59
22.79
44.96
28.07
19.92
0
1990 1995 2000 2005 2010
Inner
Mongolia
, 8.9
Year
Floating population in the province
Shanghai
, 5.9
Floating population into the province
Floating population out the province
Jiangsu,
6.4
Shannxi, Guangdo
6.6 ng, 7.8
Figure 5 Inter-Province Population Migration in Gansu, 1990-2010 (Left), and Shares of Emigrants by Destination Provinces in 2010 (Right) Source: The Sixth National Population
Census
Gansu’s population has shown an aging trend, with work age population beginning to decrease in 2015, first time over the past sixty years. In 2010, census showed that the population aged 15-64 accounted for 73.61% of the total population. In 2015, however, a 1% survey showed that the percentage had dropped to 72.63%, probably because the massive out-migration of work-age population (Figure 6).
(1% National Population Sample Survey 2016)
73.61
80.00
70.00
60.00
50.00
40.00
30.00
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72.63
72.18
67.97
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4.06
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9.83
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3.09
2.07
1953 1964 1982 1990 2000 2010 2015 2016
Aged 0-14 Aged 15-64
Aged 65 and Over
Figure 6 Evolution of the Age Structure of Population in Gansu, 1953-2016
Source: Gansu Development Yearbook, 2017
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2.2.2 Education
Population is relatively lowly educated, though primary school enrollment remains high in recent years. In 2010, the illiteracy level of Gansu’s population was 8.69%, more than double the national average of 4.08%. However, in 2015, the primary school enrollment was 99.83%, which had increased by 0.03 percentage point from the previous year and was slightly higher than the national average of 99.81%.
Moreover, population with higher educational attainments, including junior secondary schools, senior secondary schools, junior colleges (advanced vocational schools), and colleges and above, have been steadily increasing over the past three decades (Figure 7) (The Sixth National Population Census; 1%