Dissertations, Theses, and Capstone Projects

Date of Degree


Document Type


Degree Name





Karna Basu

Committee Members

Wim Vijverberg

Jonathan Conning

Partha Deb

Subject Categories

Behavioral Economics | Development Studies | Educational Psychology | Education Economics | Labor Economics


Identity, Occupation, Labor Substitution, Educational Investments, India


Poor parents face difficult trade-offs when investing in their children's education. This dissertation studies how low-income urban households in Southern India, where child labor is a concern, make educational investments for their children. First, I build a model that shows how educational investments are shaped by the possibility of children substituting labor for their parents. Second, I collect parent surveys, child surveys, and student-level administrative data from schools and construct a linked dataset. Third, I examine the relationship between educational investments and several pertinent factors, with an emphasis on child labor substitution and the strength of occupational identity. I find that monetary and time investments in education are negatively correlated with both child substitution and the strength of a parent’s occupational identity. Parents who have high aspirations for their children invest significantly more time in their children’s education. Children who are highly motivated spend more time in school-and study-related activities. Also, children for whom occupation is important for their own identity perform better at school. I propose plausible mechanisms underlying these patterns. In addition, I explore the role of mother and child's beliefs about returns to education on the investments made by the household. I find that mothers who believe the marginal returns from college are higher spend significantly more time on their children's education. Further, I discuss how the presence of dissonance between the mother and child’s beliefs regarding returns from college and marginal returns from college affects investments. The findings show that households in which mothers value the returns from college more than their children the mothers spend significantly more time on their children's education. And in the households where children value the marginal returns from college more than their mothers the children spend significantly more time on their education. My findings highlight the role these unconventional variables play in understanding barriers to educational investments by low-income households.