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Weather shocks and endogenous schooling decisions: Evidence from Young Lives data in Vietnam

Nobu Yamashita and Trong Anh Trinh of RMIT University

This study contributes to this literature by examining how the weather shocks influence the schooling decision after the conclusion of the compulsory education at the age of 15 using a panel of students in Vietnam collected from the Young Lives. Vietnam provides an interesting case study to investigate the relationship between natural disasters and school decision. This is one of five countries deemed most-affected by climate change and has been suffering from a high frequency of natural disasters. These extreme events have posed a significant threat to large portions of the population living in rural areas with agricultural production being the main source of income. At the same time, Vietnam’s performance in education has been recognised to be much higher than that of other low-income countries. However, there is a risk of education lagging behind, manifested by the rate of school enrolment varying across urban/rural areas and different types of demography. The strength of our project is the use of a panel of students in the complete life cycle from birth to the age of 15/16. In contrast, much of studies usually examine the cross-sectional cohorts with the early-life weather shocks. Our approach allows us to explore what stage of income shock (the importance of contemporaneous versus early life or in- utero exposure to weather shocks). Furthermore, we can track the school performance based on the standardised tests and we also enrich the human capital formation by combining information about the schools, teachers and principals. This study thus sheds a light on the link between weather shocks and school enrolment as well as school performance in order to provide policy recommendation that can improve educational performance in Vietnam.

This research is funded by Economic Research Institute for ASEAN and East Asia (ERIA), Jakarta.