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Citation Information

Type Journal Article - Economics Discussion Papers
Title Cognitive Development, Achievement, and Parental Investments: Evidence from a Clean Water Reform in Mexico
Volume 745
Publication (Day/Month/Year) 2012
URL https://www.aeaweb.org/conference/2013/retrieve.php?pdfid=491
Mexico implemented a massive clean water reform in 1991 which led to a sharp drop in diarrhea of close to 50%. Using cohort and state variation in diarrhea reduction, we identify significant causal effects of birth year exposure to diarrhea on cognitive test scores and school achievement tests of teenage and pre-teenage girls, the corresponding estimates for boys being smaller and statistically insignificant. The gains are in the region of 0.1 standard deviations for a one standard deviation reduction in childhood diarrheal mortality rates. We find that the reform also stimulates complementary investments in girls and primarily girls, including preschool attendance and a shift in time from chores to homework, and the evidence suggests that the test score gains we identify hinge upon these investments. Parental responses are consistent with a Roy model in which a positive shock to the health endowment intensifies investments in girls’ education given their comparative advantage over boys in brains relative to brawn. In support of this, we show evidence of differential sorting of women into brain-intensive occupations, and that this sorting is increasing in education and in the brawn base of the state economy.

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