Missing Women and the Price of Tea in China: The Effect of Sex-Specific Earnings on Sex Imbalance*

Economists have long argued that the sex imbalance in developing countries is caused by underlying economic conditions. This paper uses exogenous increases in sex-specific agricultural income caused by post-Mao reforms in China to estimate the effects of total income and sex-specific income on sex-differential survival of children. Increasing female income, holding male income constant, improves survival rates for girls, whereas increasing male income, holding female income constant, worsens survival rates for girls. Increasing female income increases educational attainment of all children, whereas increasing male income decreases educational attainment for girls and has no effect on boys' educational attainment.