Old‐Age Pensions and Female Labour Supply in India

Vidhya Unnikrishnan and Kunal Sen

Journal of International Development, 2025, vol. 37, issue 6, 1337-1350

Abstract: Whether cash transfers have unintended effects on the recipient household's labour supply is of considerable policy interest. We examine the impact of the Indira Gandhi National Old‐Age Pension Scheme (IGNOAPS) on prime‐age women's labour supply decisions in India, where female labour force participation continues to decline over time. We use propensity score matching (PSM) to make households with IGNOAPS recipients comparable with programme non‐recipients. Further, we use individual fixed effects (FE) to eliminate the effect of other time invariant unobservable characteristics on women's labour market behaviour. Our results from the PSM‐FE suggest that having a pensioner in the household increases the probability of working in paid employment by 3.87 percentage points for women aged 20–50. We have explored the income effect and childcare constraint as potential mechanisms.

Date: 2025
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https://doi.org/10.1002/jid.70013

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Persistent link: https://EconPapers.repec.org/RePEc:wly:jintdv:v:37:y:2025:i:6:p:1337-1350

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