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Educational Investment Responses to Economic Opportunity: Evidence from Indian Road Construction

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  • Adukia, Anjali
  • Asher, Samuel
  • Novosad, Paul

Abstract

The rural poor in developing countries, once economically isolated, are increasingly being connected to regional markets. Whether these new connections crowd out or encourage educational investment is a central question. We examine the impacts on educational choices of 115,000 new roads built under India's flagship road construction program. We find that children stay in school longer and perform better on standardized exams. Treatment heterogeneity supports the predictions of a standard human capital investment model: enrollment increases are largest where nearby labor markets offer the highest returns to education and lowest where they imply high opportunity costs of schooling.

Suggested Citation

  • Adukia, Anjali & Asher, Samuel & Novosad, Paul, 2017. "Educational Investment Responses to Economic Opportunity: Evidence from Indian Road Construction," MPRA Paper 80194, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:80194
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    References listed on IDEAS

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    Cited by:

    1. Shilpa Aggarwal & Brian Giera & Dahyeon Jeong & Jonathan Robinson & Alan Spearot, 2018. "Market Access, Trade Costs, and Technology Adoption: Evidence from Northern Tanzania," NBER Working Papers 25253, National Bureau of Economic Research, Inc.
    2. Amrit Amirapu & M Niaz Asadullah & Zaki Wahhaj, 2018. "Marriage, Work and Migration: The Role of Infrastructure Development and Gender Norms," Studies in Economics 1810, School of Economics, University of Kent.
    3. Adukia,Anjali & Alsan,Marcella & Babiarz,Kim & Goldhaber-Fiebert,Jeremy D. & Prince,Lea, 2020. "Religion and Sanitation Practices," Policy Research Working Paper Series 9131, The World Bank.
    4. Abu-Qarn, Aamer & Lichtman-Sadot, Shirlee, 2019. "Connecting Disadvantaged Communities to Work and Higher Education Opportunities: Evidence from Public Transportation Penetration to Arab Towns in Israel," IZA Discussion Papers 12824, Institute of Labor Economics (IZA).
    5. Matteo Fiorini & Marco Sanfilippo, 2019. "Roads and jobs in Ethiopia," WIDER Working Paper Series wp-2019-116, World Institute for Development Economic Research (UNU-WIDER).
    6. Chaurey, Ritam & Le, Duong Trung, 2018. "Infrastructure Grants and the Performance of Microenterprises," IZA Discussion Papers 11749, Institute of Labor Economics (IZA).
    7. Raoul van Maarseveen, 2020. "The urban rural-education gap: do cities indeed make us smarter?," CPB Discussion Paper 412.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    8. Porzio, T. & Santangelo, G., 2019. "Does Schooling Cause Structural Transformation?," Cambridge Working Papers in Economics 1925, Faculty of Economics, University of Cambridge.
    9. Cevat Giray Aksoy & Michael Ganslmeier & Panu Poutvaara, 2020. "Public Attention and Policy Responses to Covid-19 Pandemic," CESifo Working Paper Series 8409, CESifo.
    10. Asher, Sam & Garg, Teevrat & Novosad, Paul, 2018. "The Ecological Footprint of Transportation Infrastructure," 2018 Annual Meeting, August 5-7, Washington, D.C. 274246, Agricultural and Applied Economics Association.
    11. Sumit Agarwal & Abhiroop Mukherjee & S Lakshmi Naaraayanan, 2019. "Roads and Loans," HKUST IEMS Working Paper Series 2019-61, HKUST Institute for Emerging Market Studies, revised May 2019.
    12. Aksoy, Cevat G. & Carpenter, Christopher S. & De Haas, Ralph & Tran, Kevin D., 2020. "Do laws shape attitudes? Evidence from same-sex relationship recognition policies in Europe," European Economic Review, Elsevier, vol. 124(C).
    13. Amirapu, Amrit & Asadullah, M Niaz & Wahhaj, Zaki, 2020. "Social Barriers to Female Migration: Theory and Evidence from Bangladesh," GLO Discussion Paper Series 692, Global Labor Organization (GLO).
    14. Aksoy, Cevat Giray & Ganslmeier, Michael & Poutvaara, Panu, 2020. "Public Attention and Policy Responses to COVID-19 Pandemic," IZA Discussion Papers 13427, Institute of Labor Economics (IZA).
    15. Aggarwal, Shilpa, 2018. "Do rural roads create pathways out of poverty? Evidence from India," Journal of Development Economics, Elsevier, vol. 133(C), pages 375-395.

    More about this item

    Keywords

    Education; Roads; India; Human capital; labor demand shocks; infrastructure; development;

    JEL classification:

    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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