Selling Crops Early to Pay for School: A Large-scale Natural Experiment in Malawi

In 2010, primary school in Malawi began in September, three months earlier than in 2009. We test whether this change forced poor households to sell crops early, before output prices reach their peak. Difference-in-difference and triple difference specifications show that the cumulative value of crop sales made before September was significantly higher in 2010 than in 2009. The effect is limited to households with school-aged children, is increasing in the number of school-aged children, and is only present for households in poverty. These findings demonstrate an important channel by which liquidity constraints exacerbate the negative effects of intra-annual price volatility.