The effect of parental labor supply on child schooling: evidence from trade liberalization in India

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 industry-specific tariffs during a period of trade liberalization. The results show that an increase in maternal labor supplied outside of the household leads to a higher schooling probability for younger children. Specifically, a 1 day per week increase in maternal labor supply is associated with an approximately 5 % points increase in the schooling probability for children between the ages of 7 and 10. However, father’s labor supply has an insignificant effect on child schooling across all specifications. The effect for older children between the ages of 11 and 14, who face a tradeoff between schooling, market work, and domestic work, is also found to be insignificant.