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Does social capital affect investment in human capital? Family ties and schooling decisions

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  • Salvatore Di Falco
  • Erwin Bulte

Abstract

We analyse whether traditional sharing norms within kinship networks affect education decisions of poor black households in KwaZulu-Natal. Theory predicts that the size of the kinship network ambiguously impacts on the incentive to invest in human capital (due to opposing 'empathy' and 'free-rider' effects). Our empirical analysis, based on a range of different estimators, suggests the latter effect dominates: forced solidarity within the network discourages investments in human capital.

Suggested Citation

  • Salvatore Di Falco & Erwin Bulte, 2015. "Does social capital affect investment in human capital? Family ties and schooling decisions," Applied Economics, Taylor & Francis Journals, vol. 47(2), pages 195-205, January.
    • Handle: RePEc:taf:applec:v:47:y:2015:i:2:p:195-205
    DOI: 10.1080/00036846.2014.967383
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    Cited by:

    1. Fromell, Hanna & Nosenzo, Daniele & Owens, Trudy & Tufano, Fabio, 2021. "One size does not fit all: Plurality of social norms and saving behavior in Kenya," Journal of Economic Behavior & Organization, Elsevier, vol. 192(C), pages 73-91.
    2. Hanna Fromell & Daniele Nosenzo & Trudy Owens & Fabio Tufano, 2019. "One Size Doesn’t Fit All: Plurality of Social Norms and Saving Behavior in Kenya," Discussion Papers 2019-12, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.

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