Does social capital affect investment in human capital? Family ties and schooling decisions

Salvatore Di Falco*, Erwin Bulte

*Corresponding author for this work

Research output: Contribution to journalArticleAcademicpeer-review

Abstract

We analyse whether traditional sharing norms within kinship networks affect education decisions of poor black households in KwaZulu-Natal. Theory predicts that the size of the kinship network ambiguously impacts on the incentive to invest in human capital (due to opposing ‘empathy’ and ‘free-rider’ effects). Our empirical analysis, based on a range of different estimators, suggests the latter effect dominates: forced solidarity within the network discourages investments in human capital.

Original languageEnglish
Pages (from-to)195-205
JournalApplied Economics
Volume47
Issue number2
DOIs
Publication statusPublished - 2015

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Keywords

  • Africa
  • extended family
  • investments
  • kinship
  • moral economy

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