Does public infrastructure affect human capital? The effect of improved transport connectivity on children's education in the Philippines

Abstract

While the literature acknowledges the importance of transport infrastructure and improved connectivity to economic growth, a less explored aspect is how these investments impact human capital. This paper seeks to address this gap by evaluating the impact of the Roll-on/Roll-off (Ro-Ro) policy -a policy that allowed for a more efficient mode of inter-island transfer within the country -on school attendance in the Philippines. Using a difference-in-differences strategy, we compare the school attendance of children in municipalities near the Ro-Ro and the non-Ro-Ro ports over the span of ten years. Our results show consistent improvements in school attendance of males and females in the primary, secondary and tertiary level of education in areas near the Ro-Ro ports. We also observe a reduction in child employment, especially in males. Additional tests reveal that the Ro-Ro policy was able to affect children's education through increased household income in areas near the Ro-Ro ports.