Household Reaction to Different Kinds of Shocks: Evidence from Developing Countries

Human capital comprises all the skills that increase the productivity of a person and its accumulation is one of the factors that explain the persistence of long run economic growth, even without technological change. However, human capital accumulation does not always happen under ideal circumstances. Events that destabilize a household or uncertainty brought by political turmoil can modify the optimal behavior of a household and deter investments in human capital. The purpose of this dissertation is to analyze the effects of shocks and uncertainty on the human capital accumulation of children. To do so, I focus on household survey data from Indonesia and Colombia.;In the first chapter, I look whether households resort to child labor to cope with the effects of negative income shocks. The results show that the children increase their supply of labor when households experience a crop loss or face the aftermath of a natural disaster. In the second chapter, I estimate the impact of the presence of rebel groups on schooling outcomes for rural children in Colombia. The results show no effect on attendance and a mixed one on the accumulated years of education. In the third chapter, I look at the factors correlated with child immunity in Colombia. . My results suggest that individual-level factors like children sex, and household level variables like household size and if a female is the household head are important for explaining variations in vaccination rates. Furthermore, I found evidence that children who have to travel longer to reach a health center have lower vaccination rates. The results from this dissertation highlight the effect of household shocks in the human capital accumulation of children.