Female Labour Force Participation and Child Education in India: The Effect of the National Rural Employment Guarantee Scheme

We study the impact of India's National Rural Employment Guarantee Scheme (NREGS) on children's educational outcomes via women's labour force participation. Using data from the Young Lives Study and taking advantage of the spatial and temporal variation in the intensity of implementation of the NREGS, we find that greater participation of mothers in the program is associated with better educational outcomes of their children. Father's participation in the NREGS, on the other hand, has a negative effect on children's education. Further, the estimated impact of mother's program participation is over and above any income effect induced by the scheme and is robust to concerns about endogeneity of labour force participation and differences in economic trends between districts. We provide evidence which suggests that the mechanism through which children's educational outcomes improve is empowerment of mothers resulting from better labour market opportunities for females.