The Economics of a Girl Child-Gaurav Agrawal (IAS)


After Amir Khan talked about it on his show Satyamev Jayate the issue of saving the girl child caught the public imagination. The government machinery swung into action and within no time numerous …

After Amir Khan talked about it on his show Satyamev Jayate the issue of saving the girl child caught the public imagination. The government machinery swung into action and within no time numerous advertisements were issued by the governments in newspapers. An example of such advertisements is shown below.
Many facebook pages came up like this using particularly touching pictographic material.

What do we infer from such advertisements / initiatives apart from the fact that obviously the girl child is in danger? These advertisements / initiatives seek to ‘increase the awareness’. They want to make people aware of how important the girl child is. However, the point to be noted here is that they depict the importance of the girl child to the society in general and not to the particular parent. It is this dynamics of the importance of the girl child to the society vis a vis the parent which we will explore in greater detail here. Then the government initiatives largely end here i.e. with the advertisements. True there are many schemes seeking to incentivise the birth of a girl child and laws penalising foeticide, but these are simply haphazard in planning and lax in implementation. Is this sufficient or is there an inherent drawback in this strategy?

Let us examine this issue in greater detail.

The Society versus the Individual

The girl child in current context is clearly a valuable asset to the society. Its simple, we need more girls to restore the gender balance. The other reasons – I needn’t even go into them as they are so well known.

Anyways, the point however is that to a parent, a girl child is a cost. She has to be fed (and hopefully educated) through her childhood and when the time comes to reap the benefits of this investment, she has to be married off and sent away. Her benefits flow to some other family. And not to mention the steep costs of the marriage. Thus to an individual parent couple, a girl child is a loss making proposition.

In other words, the girl child has large positive externalities. (A positive externality is a situation when the benefits of a commodity overflow to the society and can’t be limited to the buyer only. So the buyer derives less benefits and hence pays less. So the production will always be less than the socially desirable level.) In such a condition, left to its own, the society will never produce enough girl children (because producing a girl child is a loss making proposition for the parents so why should they produce a girl child). This is a classic case of market failure and hence we need the government to step in.

Returning to the spreading awareness initiatives, we can now question the effectiveness of this strategy. Are girls being killed really because people don’t know how important they are to the society? No sir no, even if all of us are educated to the highest levels, we will still never produce girl children to the socially needed level. Because the economics of a girl child simply doesn’t make any sense.

Then will reducing the expenses of marriage and dowry address the problem? Well it will certainly increase the number of girls (because the costs of a girl child are now less) but it will never produce the socially needed number of girls.

Will increasing penalties for pre natal sex determination tests help? Certainly it has the potential to correct the imbalance. But that will require a very high level of surveillance. Its biggest weakness is that it is a coercive method and tries to solve the problem without correcting the underlying market economics which gives birth to the problem in the first place.

This brings us to the question that what will work… The economics of the girl child is wrong and clearly we must correct the economics if we are to make any headway. In case of a girl child, marriage and subsequent migration is inevitable. So either we try to change the culture where traditionally the parents can’t live on the daughter’s earnings and daughters start to live with their parents only instead of migrating like the sons or we try to enhance the ‘earning power’ of the girls before they get married.

Changing the former may be a very slow process.. So the government must intervene to enhance the pre-marriage earning power of the girls instead of merely try to ‘spread awareness’. A very good case here is that of Bangladesh where each school attending girl is allowed to carry a bag of rice home every month. And believe it or not, Bangladesh performs better than India on almost all gender related indices. So enough of talk or giving fifty rupees as incentive to BPL citizens on each girl born. We need to correct the economics here.

Source: The Economics of a Girl Child

Advertisements

One thought on “The Economics of a Girl Child-Gaurav Agrawal (IAS)”

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s