EMIGRATION OPPORTUNITIES BOOST DEMAND FOR EDUCATION IN POOR COUNTRIES: Evidence from Gurkha boys aspiring to join the British army

The opportunity for Gurkha boys in Nepal to join the British Army has a big positive effect on their rates of school enrolment and completion – and that''s despite the low probability of success with just one in 83 applicants is accepted.

According to research by Slesh Shrestha, published in the March 2017 issue of the Economic Journal, a new requirement that all applicants complete at least 10 years of education led to a 20% increase in time spent in school by Gurkha boys who did not eventually emigrate.

His study also finds that Gurkha men who tried unsuccessfully to join the British Army benefited considerably from the extra human capital they had accumulated though education. Among Gurkhas who were directly affected by the educational requirement, those who are now at least 21 years old and still in Nepal are more likely to be employed in non-agricultural, formal jobs, and their earnings are up by almost 70%.

The research begins by noting that an increasing trend in international migration from developing to developed countries has opened up access to many modern jobs to individuals from poor countries. While these jobs can come with the risk of losing educated (and scarce) workers to better pay and a better quality of life, they can also spur educational investments in these countries.

The development impact therefore depends on the net change in education of those who are left behind, on the benefits to such migration-induced investment in their mostly agrarian and rural home economies. If such benefits do accrue to non-migrants, then the positive impact of migration goes beyond simply improving the wellbeing of migrants'' household members who receive remittances: it also benefits non-migrant households that were unsuccessful in sending family members abroad.

This study identifies a positive impact of migration on the education and earnings of non-migrants by examining a unique and historical foreign employment opportunity that is available to Nepali men: to enlist in the British Army. The British Army has recruited men from South Asia since the British Raj. This practice continues in Nepal, where the British Army annually recruits able-bodied men mainly from the Gurkha ethnic communities to serve in its British Gurkha Regiments.

While the direct economic benefits to the families of Gurkha soldiers and ex-soldiers are well documented, very little is known about its role in fostering greater educational attainment among Gurkha boys who grow up aspiring to join the British Army.

In 1993, the British Army introduced a minimum requirement of at least eight years of education (further raised to 10 years in 1997) for all applicants to join the British Gurkha Army. In response to the rule change, local Gurkha boys who would be directly affected by the new selection rule raised their school enrolment by 20%, and more importantly, increased their 10 years completion rate (the cut-off for the eligibility criteria) by 60%.

This positive impact on schooling among Gurkha boys is above and beyond the secular trend in education experienced by non-Gurkha boys over the same time period, as well as that by Gurkha and non-Gurkha girls. Despite the low probability of success (one in 83 applicants), the large financial windfall if successful in joining the British Army means that their expected benefit from investing in 10 additional years of schooling exceeds the costs by more than four times.

This is common across many developing countries, where the large income gap between developed and developing countries has made migration an attractive opportunity despite the low probability of success.

After taking account of British Gurkha recruitment and other emigration possibilities, the average educational level of Gurkha men who stayed behind in Nepal is considerably higher due to the rule change: a 20% increase in the years of education completed among non-migrant Gurkha men.

More importantly, those Gurkha men who tried unsuccessfully to join the British Gurkha Army or emigrate elsewhere, benefited from the additional human capital they accumulated initially for the purpose of migration. Among Gurkha men who were directly affected by the new selection rule, those who are now at least 21 years old and still living in Nepal are more likely to be employed in non-agricultural, formal jobs. Their earnings have also increased by almost 70%.

But the ability of Gurkha households to respond to the increase in their sons'' educational returns depends on the supply of schools in the region, and other household constraints. For example, the study finds that Gurkha boys who come from wealthier and non-agricultural households, who are less likely to be constrained by household finance and by labour needs for household farming, raise their education by twice as much as their relevant counterparts.

Similarly, the educational response among Gurkha boys from regions with a limited supply of schools is also considerably lower than among those that have better access, especially in the years immediately after the rule change. But this difference in educational responses between the two regions (groups) disappears over time, suggesting a potential supply-side response to the recruitment-induced higher demand for education.

''No Man Left Behind: Effects of Emigration Prospects on Educational and Labour Outcomes of Non-migrants'' by Slesh Shrestha is published in the March 2017 issue of the Economic Journal. Slesh Shrestha is Assistant Professor in the Department of Economics at the National University of Singapore.