Does free education reduce early school dropouts? Evidence from a legislative reform in India

Abstract

We examine the role of free elementary education in reducing elementary school dropouts in India following the legislative reform on provision of Universal Education in 2009. We find that the impact was significant across all districts on average, but was notably higher for those at lower levels of development. Our results highlight the importance of removing barriers to schooling mainly in the form of costs that enable children in poorer areas to continue schooling. Provisions of infrastructural facilities such as toilets are also found to play a significant role in reducing dropouts. Further, our findings indicate the need for developing amenities for disabled children. Higher literacy rates are significantly associated with lower dropout rates indicating the urgent need for targeted government policies that can uplift generations out of a perpetuating education trap.