How long the shadow of the city? The impact of urbanisation on schooling

Abstract

What is the impact of rapid urbanisation on rural schooling? In this paper we use data from the district of Gautam Buddha Nagar, lying in Uttar Pradesh and bordering Delhi, to answer this question. This district has seen rapid urbanization in the last decade. This process of urbanization is exogenous in nature and this allows us to convincingly identify the spillovers from urbanization on neighbouring rural areas. Using digitized census maps, census data from 2001 and 2011, the DISE data on schools, and using a difference-in-difference methodology, we identify the impact of urbanization on schooling in rural GB Nagar. We find that the increase in the number of schools in the last decade is higher in villages closer to the urban agglomeration. While this effect is there for all levels of schooling it is stronger for higher levels of schooling. This change cannot be completely explained by increase in population in villages closer to the city. These results are consistent with the hypothesis that households are making schooling decisions that allow for increased participation in the urban labour market in the future. We also estimate models with interaction terms to see if different initial conditions in villages shape the future growth in schooling.