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Food Price Inflation and Children's Schooling

Discussion Papers 844, 31 S.

Michael Grimm

2008. Dez.

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I analyze the impact of food price inflation on parental decisions to send their children to school. Moreover, I use the fact that food crop farmers and cotton farmers were exposed differently to that shock to estimate the income elasticity of school enrolment. The results suggest that the shock-induced loss in purchasing power had an immediate effect on enrolment rates. Instrumental variable estimates show that the effect of household income on children's school enrolment is much larger than a simple OLS regression would suggest. Hence, policies to expand education in Sub-Saharan Africa, should not neglect the demand side.

JEL-Classification: I21;O12;Q12
Keywords: Education, Household Income, Inflation, Aggregate Shocks, Africa
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