Left-of-center politicians are often demonized for simply “throwing money at a problem” instead of concocting a more innovative solution. But there are, in fact, instances in which direct cash incentives are by far the most efficient tact. Such appears to be the case in India, which continues to have a serious problem with female infanticide, especially among the rural poor. As Delhi’s government is discovering, the best way to address this problem is not through education, but rather a thoughtfully structured series of bribes:
Currently, the Delhi Government’s Ladli scheme to counter the bias against the girl child seems to have borne fruit, with the latest data showing that 19,000 more girls were born in 2008 than in the previous year. The sex ratio apparently is 1,004 girls for 1000 boys. The number of female babies exceeding males in Delhi is unprecedented in recent years…
Some officials credit it to the financial incentives offered under the Ladli scheme. These, briefly, are that the Government deposits a sum of Rs 5,000-6,000 for every baby girl, born to a family with an annual income below Rs 100,000. Subsequently, in a bid to ensure that the child goes to school, the Government deposits Rs 5,000 at the time of admission, and when the girl enters Class I, VI, IX, X and XII. These sums mature in a fixed deposit till the beneficiary turns 18. She can then claim the amount.
We’d be interested to see the calculus on how a more balanced gender ratio affects GDP. Certainly no good can come of a society in which, as the article notes, some villages have only a dozen girls for every 250 boys—a situation which leads to skewed marriage markets, not to mention a lot of psychological distress for lonely male hearts.