Historical Clans and Contemporary Human Capital

Abstract This study examines the long‐term impact of historical clan strength on contemporary human capital development in China. Our findings reveal that historical clan strength had a significant positive effect on individual human capital, particularly in rural households, even after accounting for confounders and robustness checks. We observe that clan culture complemented the implementation of compulsory education in shaping contemporary educational outcomes. Mechanism analysis suggests that clan strength motivated parents to prioritize their children's education and increased the likelihood of low‐income individuals receiving financial assistance from relatives and friends. However, we find no evidence that clan strength affected the allocation of public educational resources. These findings highlight the enduring role of cultural transmission mechanisms in human capital formation and underscore the importance of incorporating cultural factors into the design of educational policies.