Social learning, neighborhood effects, and investment in human capital

Abstract

"This paper shows that neighborhood factors matter in schooling investments: in the face of the availability of a new technology that altered schooling returns, agents learned of the benefits of new returns to schooling from neighbors and adjusted schooling investments over time. Using household data available from the onset of the Green Revolution in India—where in some regions the diffusion of high-yielding varieties (HYVs) affected returns to schooling — the author shows that the schooling distribution of the parents' generation in a neighborhood is important to social learning and household decisions regarding child schooling investments. The study attempts to empirically identify the process of social learning and neighborhood effects on child schooling investments in a Bayesian learning model." From TextHuman capital ,Risk ,Social learning ,School enrollment ,technological changes ,Green Revolution ,