In this paper, we develop a two-strata general-equilibrium model of human capital acquisition with endogenous school construction that permits an assessment of the relative impacts of technological change and school availability on schooling investments in landless and landed households and illuminates how these choices interact through the adult and child labor markets. The implications of the model are tested using a unique household-level panel data set which constitutes a representative sample of rural India during the peak period of agricultural innovation associated with the green revolution, 1968–1982. The empirical results indicate that the operation of the market for child labor worsens the distributional impact of agricultural productivity on school investment across landless and landed households, as landless child labor is used to replace landed child labor lost due to increased child school attendance in landed households. The results also suggest, however, that the allocation of school construction diminishes the adverse impact of technical change on the gap between landless and landed schooling investment.
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