Drought of Opportunities: Contemporaneous and Long-Term Impacts of Rainfall Shocks on Human Capital

By M. Shah, B. Steinberg. Journal of Political Economy, 2017

386 citations recorded by the source corpus.

Higher wages are generally thought to increase human capital production, particularly in the developing world. We introduce a simple model of human capital production in which investments and time allocation differ by age. Using data on test scores and schooling from rural India, we show that higher wages increase human capital investment in early life (in utero to age 2) but decrease human capital from age 5 to 16. Children switch out of school into productive work when rainfall is higher. The opportunity cost of schooling, even for fairly young children, is an important factor in determining overall human capital investment.

Subfields: Safety Research, Sociology and Political Science, Soil Science

View Paper: https://www.semanticscholar.org/paper/c01824ccf1c0b11ca88c1254adea940e0ad3567c

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Citations in the corpus

Educational Investment Responses to Economic Opportunity: Evidence from Indian Road Construction (2017, neutral): “…to impacts on human capital accumulation from India’s national public works program (MGNREGA), which has found small decreases in enrollment for middle school students across India (Das and Singh, 2013; Islam and Sivasankaran, 2015; Li and Sekhri, n.d.; Shah and Steinberg, 2015; Adukia, 2018).”
Age of Marriage, Weather Shocks, and the Direction of Marriage Payments (2020, positive): “…hazard for young women, we follow an approach that is widely used in the economics literature that exploits variation in local rainfall as a proxy for local economic conditions (see Jayachandran (2006); Burke, Gong, and Jones (2015); Kaur (2019); Shah and Steinberg (2017) among many others).”
Temperature and Human Capital in India (2020, background): “Note that cold temperatures have also been shown to have an adverse effect on learning and cognitive function (Lieberman, Castellani and Young, 2009; Mäkinen et al., 2006; Muller et al., 2012; Sharma and Panwar, 1987; Taylor et al., 2016).”
Selection into Identification in Fixed Effects Models, with Application to Head Start (2019, positive): “For example, Shah and Steinberg (2017) employ this strategy and find that a positive rain shock (top 20 percent rainfall) reduces the likelihood that students attend school, and vice versa for droughts.”
Do rural roads create pathways out of poverty? Evidence from India (2018, background): “Several authors, including Duranton and Turner (2012) and Volpe Martincus et al. (2017), have instrumented for current infrastructure using ancient routes that are no longer in use.”
Childhood Circumstances and Adult Outcomes: Act II (2018, neutral): “Two papers, by Hoynes, Miller, and Simon (2015) and Dahl and Lochner (2012) examine the effect of the U.”