The research studies parent’s beliefs about their investment in extracurricular activities and the implications in student competition, anxiety and educational inequality in China. To compete for limited educational opportunities such as admissions to elite schools, when making educational investments, parents would not only consider their children’s own ability, but also other parents’ behavior. However, due to lack of information, parents might have biased beliefs about the relative level of their investments, which could lead to a suboptimal level of investment as well as excessive anxiety. This study intends to conduct a randomized controlled trial among elementary and middle school parents in a major city in China to examine parents’ beliefs about their relative educational investments. Specifically, the following three research questions will be explored: 1) whether parents consider others’ behavior when making education investments; 2) whether parents have biased beliefs about others’ investment behavior; and 3) when information was given, whether their beliefs and behavior in educational investment would be affected.