Tertiary Education and Prosperity in Developing Countries: Catholic Missions to Luminosity in India Amparo Castelló-Climent (University of Valencia) Latika Chaudhary (Naval Postgraduate School) Abhiroop Mukhopadhyay (Indian Statistical Institute) 0 Castello, Chaudhary and Mukhopadhyay Human Capital
Motivation The macro literature has tried to identify the fundamental determinants of development Institutions (AJR 2001, Acemoglu et al. 2002, 2014), Geography (Sachs 2003), Trade (Frankel and Romer 1999), Human Capital (Lucas 1998) Evidence linking human capital to income is weak at the macro-level These macro findings are at odds with a large literature in labor economics on the returns to education • 10 to 15% for each additional year of schooling Castello, Chaudhary and Mukhopadhyay Human Capital 1
Motivation The literature on the macro effect of human capital on growth using average years of schooling is not conclusive: Barro (1991): Positive Impact of Human capital on growth: challenged by Bils and Klenow: most of the variation explained by the fact that human capital depends on expected growth. Other challenges: Pritchett (2010) Even individual country results hotly contested: China • Bosworth and Collins (2008): human capital unimportant for China’s growth • Whalley and Zhao (2010): human capital is important! Castello, Chaudhary and Mukhopadhyay Human Capital 2
Potential Explanations for Discrepancy Measurement of human capital is incorrect Average years of education may not be the most appropriate measure of human capital • Especially in poor countries with significant illiteracy Quantity is not quality adjusted Problems of cross-country analysis Differences in culture, institutions and access to technology make causal relationships hard to estimate Castello, Chaudhary and Mukhopadhyay Human Capital 3
What do we do? We estimate the impact of tertiary education completion on development using district-level data from India Advantages of district-level analysis • More homogeneous units compared to countries Night lights as a proxy for development (Henderson et al. 2012) Tertiary education is correlated with development and growth in India (Castelló-Climent and Mukhopadhyay 2013) Castello, Chaudhary and Mukhopadhyay Human Capital 4
Endogeneity of tertiary education Evolution of tertiary education and income generally go together Include controls for geography, social structure and historical factors that may influence tertiary education Use exogenous variation generated by the location of Catholic missions circa 1911 as an instrument Is the location of missions endogenous? • History of Catholicism in India • Regressions using data from 1931 and 1901 • Big push in setting up Catholic schools and colleges comes after independence Castello, Chaudhary and Mukhopadhyay Human Capital 5
Findings Significant positive effect of tertiary education completion on luminosity No weak instruments problem Robust to alternate definitions of development Robustness checks suggest catholic missions did not influence economic development through other channels Health, Infrastructure, British India versus Princely States Impact of tertiary education via service sector* Castello, Chaudhary and Mukhopadhyay Human Capital 6
Data Cross-sectional analysis of 500 districts in 20 states of India (2001 vintage) Measure of economic development Night Lights 2006 (Defense Meteorological Satellite Program (DMSP) satellites. National Oceanic and Atmospheric Administration (NOAA) of the USA Pixel Luminosity 0 to 255 : Aggregated to the district level divided by the total area of the district: Light Density • (Henderson et al, 2012; Michalopoulos and Papaioannou, 2013) Castello, Chaudhary and Mukhopadhyay Human Capital 7
Night Lights Castello, Chaudhary and Mukhopadhyay Human Capital 8
Data District Level Education Shares (Census 2001) Share of population 25+ who have completed tertiary education • Degrees and diplomas in general and professional education Other controls Geography Proportion SC/ST Historical Castello, Chaudhary and Mukhopadhyay Human Capital 9
Completed Level: Tertiary Education Mean: 5.8% Range: 1.4 % to 21.3% Castello, Chaudhary and Mukhopadhyay Human Capital 10
5 Total Luminosity/Sq Kms (logs) 0 Correlation: 0.46 -5 0 .1 .2 .3 Share Pop. over 25 w/ Tertiary Education Castello, Chaudhary and Mukhopadhyay Human Capital 11
OLS Specification and Controls X β s D s + θ share tert ds + ρ 0 C ds + π 0 G ds + δ 0 H ds + ε ds log lightdensity ds = α + (1) State Fixed Effects Current share of SC/ST and population over 25 Geographic controls • Coastal Latitude, Longitude, Avg. Height, Avg. River Length Historical controls • Share Brahman, Share Tribal, Urbanization, Railway line, Princely State Castello, Chaudhary and Mukhopadhyay Human Capital 12
Table 2: OLS Results - Log Light Density (1) (2) (3) (4) (5) Share Tertiary 14.396*** 11.203*** 10.638*** 9.871*** 8.019*** (1.136) (1.176) (0.921) (0.965) (1.077) Share Secondary 1.317*** (0.506) Controls State FE YES YES YES YES YES Current NO YES YES YES YES Geographic NO NO YES YES YES Historical NO NO NO YES YES Schooling NO NO NO NO YES Observations 500 500 500 500 500 R-squared 0.624 0.705 0.793 0.804 0.807 State FE YES YES YES YES YES Robust standard errors in parentheses. *** p < 0.01, ** p < 0.05, * p < 0.1 1 s.d. (3 % point ) Increase in Share of Tertiary Ed leads to 7 % increase in light density (relative to mean) Castello, Chaudhary and Mukhopadhyay Human Capital 13
Instrument We need an instrument to account for the potential endogeneity of tertiary education Must be correlated with 2001 tertiary completion Should meet exclusion criterion: not be correlated directly with development We use an indicator variable for whether a Catholic mission/missionary was located within the area defined by the 2001 district Catholic Missions in 1911 from Atlas Hierarchicus Castello, Chaudhary and Mukhopadhyay Human Capital 14
Maps: Catholic Missions 1911 (South) Castello, Chaudhary and Mukhopadhyay Human Capital 15
Maps: Catholic Missions 1911 (North) Castello, Chaudhary and Mukhopadhyay Human Capital 16
Projected to Current District Boundaries baramulla srinagar dalhousie pathankot amritsar jalandhar jutogh shimla ferozepur kasauli dagshai ambala dehradun saharanpur roorkee ranikote nainital sardhana meerut moradabad delhi bareilly muttra dibrugarh agra chakni chuhri darjeeling bandikui kurseong jaipur lucknow bettiah fyzabad gorakhpur ajmere cawnpore nasirabad darbhangah gwalior gauhati purniah shillong allahabad bankipur jhansi benares jamalpore cherrapoonjee bondashill bhagalpur mount abu adu road nimach deesa sangor agartala asansol krishnagar ratlam bhopal jubbulpur thundla ahmedabad tongo passan sirampur soso tarpa nadiad jhabua chaibasa howrah mhow pachmarhi kurdeg calcutta anand Catholic rajkot harda rengarih wartal bilaspur raghabpur morapai krishnachandrapur aulia bhavnagar broach khandwa balasore kamptee surat nagpur chikalda bhushawal thana Missionaries in amracti dhulia manmad daman nasik tarapur aurangabad mahim deolani surada 30% of districts agashi berhampur kolaba bombay ahmednagar parlakimedy uran poona bobbili kirkee palkonda panchgany bimlipatam waltair satara sholapur yellandu mahabaleshwar vizagapatam bolarum hyderabad chuddergat madira bimaram yanaon kolhapur ellore putibandu guntur tubada moodgal masulipatam pollur goa hubli gadag karwar bellary gooty rachol tbomarbeop guntakal bitragunta sirsi nellore shimoga gangolli kandapur arsikere pakal udipi kolar hassan killacheri madras bantwal bangalore ullal arni bela arkonam cheyur magarnada merkara ganjam polur matigiri kasargod collegal atoor mogaiur tellicherry mahe covilloor virioor cuddalore salem cannanorr erode conoor calicut paleam gudabir coimbatore thanguebar karikal kannankulam palachy coinbakunam trichur dindigal verapoly cochin madura pulial ideikarur arnakolam aleppi ramnad kanaili thangacherry vaippar quilon tutikorin mampally gurdal mampally cochin nagerkoil mullagamud cape comorin Castello, Chaudhary and Mukhopadhyay Human Capital 17
Catholic Missions: History Syrian Christians (St. Thomas Christians) are the earliest Catholics (1 st century A.D.) Catholic Church history begins with the arrival of the the Portuguese in Calicut in 1498 Under Padroada Real (special ecclesiastical privileges given to the Portuguese by the Pope), Catholic missions were set up in the 16 th century Initially Franciscans and Dominicans but then taken over by the Jesuits after arrival of Francis Xavier in 1542 Castello, Chaudhary and Mukhopadhyay Human Capital 18
Catholic Mission History Missions initially established in Portuguese strongholds of Daman, Diu, Vasai and Mumbai along the coast (78 percent of catholic missions in 1911 are located in coastal districts) Missions were then established in the interior. Individual preferences of missionaries seem to have played a role. For example, an enterprising Jesuit Robert de Nobili moved to Madurai, pretended to be an upper caste Hindu, established the Madurai mission in order to recruit Brahmins into the catholic fold Castello, Chaudhary and Mukhopadhyay Human Capital 19
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