Essays in Development and Political Economy

Abstract

This dissertation explores constraints on women's labor force participation in low-income countries, with a focus on the Indian context.

The first chapter is coauthored with Patrick Agte and it centers on caste norms, the religious and social rules that underpin the Hindu caste system. Hindu women's work and, more broadly, their role in society, are shaped by caste purity norms that promote female seclusion. We ask whether the strength of caste norms in a Hindu village community is influenced by the presence of non-Hindus in that village. We find that caste norms are weakened when Hindus live alongside Adivasis, an indigenous minority outside of the caste system. Using a number of estimation strategies, including a historical natural experiment that led to local variation in Adivasi population share, we show that having more Adivasi neighbors decreases Hindus’ adherence to a wide range of caste rules. Hindu women in Adivasi-majority villages are 50% more likely to work and have substantially higher earnings. Individuals higher on the caste hierarchy are less likely to practice "untouchability" towards those lower than them and villages are more likely to be integrated. We argue that Hindus adhere to caste norms as an investment in status within the caste system, and that this investment is less valuable when Adivasis--a lower-status out-group--form a larger share of the village population. Consistent with this explanation, caste norms are weaker in areas where British colonial policy led Adivasis to hold more land and political power, increasing the returns to social and economic interactions with Adivasis independent of their population share.

The second and third chapters of this dissertation explore questions related to access to capital for female microentrepreneurs. Both chapters make use of a microfinance field experiment with female enterprise owners in Kolkata, described in Field et al. (2013). In Chapter 2, which is coauthored with Erica Field, Rohini Pande, and Natalia Rigol, we revisit a common finding in the empirical literature on returns to capital among microentrepreneurs: multiple field experiments report positive financial returns to capital shocks for male and not female business owners. These studies often conclude that female-owned enterprises are low return (because, for instance, women have low levels of financial literacy). But these analyses overlook the fact that female entrepreneurs often reside with male entrepreneurs. Using data from the Field et al. (2013) experiment in India, along with data from capital shock experiments in Sri Lanka and Ghana, we show that the observed gender gap does not reflect lower returns on investment, when measured at the household-level. Instead, the absence of a profit response for female-owned enterprises reflects the fact that women's capital is typically invested into their husband’s enterprise. We cannot reject equivalence of household-level income gains for male and female capital shock recipients.

The third chapter, which is co-authored with Patrick Agte, Erica Field, Rohini Pande, and Natalia Rigol, examines the long-term impacts of the Field et al. (2013) intervention on enterprise outcomes and on intergenerational educational mobility. Field et al. (2013) show that, two years after the liquidity shock intervention, female microentrepreneurs in the treatment group had 19.5% higher household income. A majority of sample households had at least one child of school-going age at baseline; eleven years post-intervention, we return to the sample to examine how these entrepreneurs allocated their additional income between business and education investment opportunities. We find that, on average, children from treatment households are 35% more likely to attend college. However, education gains only accrue to literate households. In contrast, illiterate treatment households experience declines in child schooling alongside microenterprise expansion and parental income gains. As a result, treatment lowers intergenerational educational mobility and forecasted earnings equality.