Indian paradox: Rising education, declining womens' employment

Esha Chatterjee; Sonalde Desai; Reeve Vanneman

Volume 38 - Article 31 | Pages 855–878

Indian paradox: Rising education, declining womens' employment

By Esha Chatterjee, Sonalde Desai, Reeve Vanneman

Date received:

25 Aug 2017

Date published:

6 Mar 2018

Word count:

6422

Keywords:

education, family, income, India, labor force participation, women, women's employment

DOI:

10.4054/DemRes.2018.38.31

Additional Files:

demographic-research.38-31 (zip file, 1 MB)
readme.38-31 (text file, 1 kB)

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Abstract

Background: Theories of human capital would suggest that with more education, women acquire greater skills and their earnings increase, resulting in higher labor force participation. However, it has been long known that in India, women’s education has a U-shaped relationship with labor force participation. Part of the decline at moderate levels of education may be due to an income effect whereby women with more education marry into richer families that enable them to withdraw from the labor force.

Objective: The paper uses the first comprehensive Indian income data to evaluate whether the other family income effect explains the negative relationship between moderate women’s education and their labor force participation.

Methods: Using two waves of the India Human Development Survey, a comprehensive measure of labor force participation is regressed on educational levels for currently married women aged 25–59.

Results: We find a strong other family income effect that explains some but not all of the U-shape education relationship. Further analyses suggest the importance of a lack of suitable employment opportunities for moderately educated women.

Conclusions: Other factors need to be identified to explain the paradoxical U-shape relationship. We suggest the importance of occupational sex segregation, which excludes moderately educated Indian women from clerical and sales jobs.

Contribution: This paper provides a more definitive test of the other family income effect and identifies new directions for future research that might explain the paradoxical U-curve relationship.