Theses Doctoral

Essays in Labor and Development Economics

Gupta, Sakshi

In this dissertation, I explore various fundamental challenges of inequality that developing countries continue to grapple with. The first chapter seeks to understand the role of social and cultural norms in explaining the persistent gender gaps in the labor markets. The second chapter studies how schooling decisions are made in the presence of liquidity constraints. Both the above questions are answered in the context of India. The third chapter adds to our understanding of the relationship between decision-making power within households and intimate partner violence in the context of Sub-Saharan Africa.

Despite recent gains in women's educational attainment and reproductive agency, substantial gender gaps in the labor market still remain, particularly in developing countries. In my first chapter, I study the impact of culture and social norms in explaining this puzzle in the Indian setting. In particular, I examine the role of the male-breadwinner norm, which dictates that husbands should earn more than their wives. I first establish a sharp discontinuity in the distribution of the share of the wife's income at the point where the wife’s income exceeds the husband's income. I theoretically show that this pattern can be best explained by gender identity norms which make couples averse to a situation where the wife earns more than her husband. I also provide empirical evidence that this aversion has real implications for the labor market outcomes of the wife. First, the wife is less likely to participate in market activities if her potential income is likely to exceed her husband’s. Second, she earns less than her potential if she does work and can potentially out-earn her husband. Evidence from observing couples over time and bunching methods supplement these results. Moreover, these results are more pronounced in couples where the husband is making the labor market decisions of the wife and where other regressive gender norms are prevalent.

My second chapter, co-authored with Dhruv Jain, studies the importance of liquidity constraints in determining the schooling decisions of households in developing countries. Evidence across developing countries suggests that parents are often credit-constrained when making schooling decisions for their children. But little is known about the severity of this constraint. In this chapter, we ask if temporary shocks to liquidity affect parents’ decisions regarding the schooling of their children. We use a shock to available cash in the economy induced by India’s 2016 demonetization to identify this effect. The policy made 86% of currency-in-circulation illegal overnight, and individuals could deposit old notes at the bank in exchange for new ones but with significant withdrawal limits. We identify the impacts of demonetization’s severity by leveraging discontinuities in banking access across Indian districts. Difference-in-discontinuity estimates show that districts that experienced more severe liquidity shock saw an increase in dropouts from private schools but no effect in free public schools, consistent with the presence of real credit constraints. Moreover, enrollments in future periods remained unchanged, suggesting a more permanent effect.

The third chapter of my dissertation, co-authored with Aletheia Donald, Cheryl Doss and Markus Goldstein, studies the relationship between decision-making within households and its impact on intimate partner violence (IPV) in 12 Sub-Saharan African countries where 36% of women are affected by IPV. Using the wife’s responses to survey questions, we find that compared to joint decision-making, sole decision-making by the husband is associated with a 3.3 percentage point higher incidence of physical IPV in the last year, while sole decision-making by the wife is associated with a 10 percentage point higher incidence. Similar patterns hold for emotional and sexual violence. When we include the combined responses of the husband and wife about decision-making in the analysis, we identify joint decision-making as protective only when spouses agree that decisions are made jointly. Notably, agreement on joint decision-making is associated with lower IPV than agreement on decision-making by the husband. Constructs undergirding common IPV theories, namely attitudes towards violence, similarity of preferences, marital capital, and bargaining, do not explain the relationship. Our results are instead consistent with joint decision-making as a mechanism that allows spouses to share responsibility and mitigate conflict if the decision is later regretted.


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More About This Work

Academic Units
Thesis Advisors
Black Youngblood, Sandra
Ph.D., Columbia University
Published Here
June 7, 2023