Investment in human capital is one of the main avenues through which economies can achieve long-run economic growth. Governments in developing countries and Non-Government Organisations (NGOs) are aware of this, and many attempt to subsidise human capital investment by supplying health and education services at little or no cost to the individual. However, the level of human capital investment remains dependent on individuals’ demand for these services. Consequently, understanding the link between household characteristics and propensity to invest in children’s human capital can help to improve targeting of government policy, embellish theoretical models and increase the efficiency of international aid.
This thesis makes an empirical contribution on this topic, investigating the relationship between investment in children’s human capital and household type with a focus on education investment in the Central Asia and South Caucuses (CASC) region. It examines the heterogeneity of female-headed households, looking beyond the dichotomous view of male- v. female-headed households that exists in much of the economic development literature. In doing so, it extends on the existing literature, both in considering the applicability of policies which target female-headed households in this region and in examining a unique dataset to consider whether previous findings on the positive relationship between female headship and child investment and outcomes are generalisable to the CASC region. Its empirical section uses various econometric techniques to test for the significance and robustness of this relationship. Across the four countries, no consistent evidence is found to support the importance of any specific source of heterogeneity, or indeed for the significance of female headship itself. An examination of the status of women in the four subject counties suggests that these results may be due to low gender inequality in the region relative to countries where significant relationships have previously been found.
These results indicate that the push for government policy and NGO programs to target female-headed households may be misguided, at least in the CASC region. These results emphasise the need for context-specific research before implementing large-scale policies and reforms. Previous conclusions on the importance of headship in determining child outcomes in Latin America, South Asia and parts of Africa are not directly transferrable to the CASC context.