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The Effect of Parental Labor Supply on Child Schooling: Evidence from Trade Liberalization in India

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  • Ural Marchand, Beyza

    () (University of Alberta, Department of Economics)

  • Rees, Ray

    () (University of Munich)

  • Riezman, Raymond

    (University of Iowa)

Abstract

This paper estimates the effect of changes in maternal and paternal labor supply on the schooling rates of children in India using the variation in trade tariffs across a period of liberalization. The results suggest that increases in maternal labor supply raise the schooling probability of younger children by seven percentage points. This accounts for one fourth of the overall improvement in schooling rates among this age group. The effect for older children is found to be insignificant, and increases in paternal labor supply are found to have no effect on schooling rates. The results found through instrumentation were an order of magnitude higher than the ordinary effects based on correlation between parental labor supply and child schooling. In addition, a set of instruments based on the gender composition of children was used to test whether the selection of fertility levels is a driving factor. While the effect of the number of children on schooling is significant, it does not alter the coefficient of either parent’s labor supply.

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Bibliographic Info

Paper provided by University of Alberta, Department of Economics in its series Working Papers with number 2011-21.

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Length: 34 pages
Date of creation: 01 Dec 2011
Date of revision: 01 Mar 2012
Handle: RePEc:ris:albaec:2011_021

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Keywords: child schooling; labor supply; trade liberalization; India;

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  1. Felbermayr, Gabriel & Prat, Julien & Schmerer, Hans-Jörg, 2011. "Globalization and labor market outcomes: Wage bargaining, search frictions, and firm heterogeneity," Journal of Economic Theory, Elsevier, vol. 146(1), pages 39-73, January.
  2. Anderson, Siwan & Eswaran, Mukesh, 2009. "What determines female autonomy? Evidence from Bangladesh," Journal of Development Economics, Elsevier, vol. 90(2), pages 179-191, November.
  3. David Lam & Suzanne Duryea, 1999. "Effects of Schooling on Fertility, Labor Supply, and Investments in Children, with Evidence from Brazil," Journal of Human Resources, University of Wisconsin Press, vol. 34(1), pages 160-192.
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