Returns to Education and Female Participation Nexus: Evidence from India

In this paper, we aim to understand whether low labour market returns to education in India are responsible for low female work participation. The National Sample Survey Office—Employment Unemployment Survey unit level data of India for the year 2011–2012 is used to examine the relationship between educational attainment and labour market participation through gender lens. Results show that women’s education has a U-shaped relationship with paid work participation. The probability to participate in the paid labour market increases with education levels higher than compulsory secondary schooling. The labour market returns to education are insignificant and low for lower levels of education, increasing significantly along the educational levels. Technical education equivalent to degree level or above has high returns for men and women. However, women with technical education have very low levels of participation. Vocational training also provides a positive return. Our results suggest that to increase participation, women need to be educated above secondary level and receive broader technical education and more vocational training.