Three Essays On Child Human Capital Development In Nepal

Abstract

This thesis is a collection of three separate but thematic studies on child human capital development in Nepal. The first study (Chapter 3) examines the relationship between parental education and child health outcomes using the Nepal Living Standards Survey 2010/11. Employing different specifications, I find that there is a positive and significant relationship between a mother’s education and child health outcomes. Furthermore, children of more educated mothers have better health outcomes compared with children of less educated mothers regardless of a child’s gender. Surprisingly, however, there is no statistically significant relationship between a father’s education and child health outcomes. To identify the gap between the health outcomes of children born to parents of different education levels along with the factors contributing to those gaps, I use the Blinder-Oaxaca decomposition method. Decomposition analysis shows that a healthy environment, information and demographic and economic characteristics are the major factors that explain most of the gaps in child health outcomes. Nepal has one of the highest ratios of international remittances to gross domestic product in the world. The second study of the thesis (Chapter 4) examines whether the massive inflow of international remittances affects child schooling, child labour and household expenses. Controlling extensively for a host of observed characteristics of households and migrants in different countries and using an instrumental variable approach, I find no significant effect of remittances on child education or child labour in Nepal. However, I do find a significant increase in non-food expenditures, including education spending due to remittances. Despite increased expenditure on child schooling, educational outcomes are not improving because of remittances. This likely reflects the fact that I am focusing on short-run changes in remittances when long-term investments and policy reforms may be needed for improving educational attainment in Nepal. Violent conflict potentially has long-term impacts on child development as volatile early-life conditions typically translate to poor health outcomes, lower educational attainment and lower lifetime earnings. The third study (Chapter 5) uses village-level conflict data combined with three waves of nationally representative repeated cross-sectional data to quantify the effects of a decade-long Maoist conflict on child health, as measured by the height-for-age Z-score. Using difference-in-difference estimators, I find that children born just prior to or during the conflict in affected villages are up to 0.30 standard deviations (14%) shorter compared with the reference group of children born during the same time period in non-conflict villages. A child’s age when exposed to conflict and the duration of exposure also matter. The conflict affects children’s health even if they are born four years after the end of the conflict. In addition, there is a gender difference wherein girls born just prior to or during the conflict suffer more than boys, but boys born after the end of conflict are affected more than girls born at the same time. These results are robust to alternative model specifications and different measures of conflict. Placebo tests support the findings as well.