The Effect of Kerosene Price on Children’s Time Allocation Decisions: Evidence From India

Fabliha Ibnat , University of Maryland

This paper studies the effect of kerosene price on the time allocation decisions of children under the age of 15 in Indian households. Because kerosene and biomass fuel are often used as substitutes, an increase in kerosene price may lead to lower demand for kerosene and higher demand for biomass fuel, which must be collected by members of the household. I instrument for kerosene price using lagged kerosene price to empirically test the effect of price on time allocated to fuel collection, water collection, and education. I find that an increase in price results in an increase in fuel collection time for children, a decrease in water collection time for children, but no change in time spent in school. Parents compensate by increasing their water collection time. These results indicate that households are able to mitigate adverse effects on children's schooling time in response to a tighter budget constraint.

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 Presented in Session 4. Marriage, Family, Households, & Unions