Human capital investment. Nutrition and household decisions on schooling: Empirical evidence from a developing country

Nutrition is currently recognized as a very important element of human capital investment, affecting schooling outcomes and ultimately earnings in adult life. Important decisions regarding investments in education, nutrition and health take place within the framework of the household. Low human capital investment and poor schooling outcomes lead households into "poverty traps." The analysis of household decision making is therefore highly relevant to the design of better poverty reduction policies that target the poor.;This research uses data on education and nutrition of children under 5 years old from a household survey conducted in Ecuador in 1998. Although the research focuses on the school-age population, the household is assumed to be the relevant unit of analysis for schooling decisions. In order to analyze the correlations between chronic malnutrition in children at vulnerable ages and school attainment of older siblings, logistic and linear regressions are used. School enrollment and years of schooling successfully completed are the dependent variables, and the number of children with chronic malnutrition is included as an explanatory variable.;The results show that there is a negative correlation between the presence of a child under five years old with chronic malnutrition and the likelihood of a child being enrolled in school, but also with the reported total number of years of school completed. Malnutrition may explain "poverty traps" not only by its effects at the individual level but through another path associated with children with chronic malnutrition at vulnerable ages and parental decisions on schooling. Public policies that provide subsidies for human capital investment for the household may be enhanced if the design considers potential spillovers between malnutrition of younger children and schooling among older siblings.