Child Labor and Schooling Decisions among Self-Help Group Members in Rural India

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info:eu-repo/semantics/altIdentifier/doi/10.1086/703046

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info:eu-repo/grantAgreement/EC/FP7/230290/EU/Social capital and enforcement of informal contracts in developing economies/SSD

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Jean-Marie Baland et al., « Child Labor and Schooling Decisions among Self-Help Group Members in Rural India », HAL-SHS : économie et finance, ID : 10.1086/703046


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This paper investigates the impact of informal microfinance groups (self-help groups, or SHGs) on children’s education and work in rural India. In 2002, 24 eligible villages were randomly selected for opening SHGs, and 12 others were randomly selected as a control group. Households were surveyed three times over a 5-year period, allowing for the study of medium-term outcomes. We find a robust and strong increase in secondary school enrollment rates over time, with intention-to-treat estimates of about 40%. This effect stems from a quicker grade progression, leading to lower dropout rates between primary and secondary school. Contrary to usual presumptions, we find no decrease in overall child labor (but a reorientation toward part-time domestic work) and no direct role of credit. By contrast, we show that social interactions within SHGs are very important.

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