Who Cares? Unpaid Labor, Human Capital and Inequality In India

India’s hidden economy with unpaid care, childcare, eldercare and any household maintenance is what shapes human capital formation yet continues to remain invisible in national statistics. This paper describes the tension between the static neoclassical view where households outsource care to minimize private costs and the feminist critique which emphasizes care work’s foundational role and the inequalities it reinforces. Using India’s 2014 female-to-male ratio of unpaid care work and the 2019- 20 Time Use Survey, we are able to document that the poorest households shoulder on average 53.9 more minutes of unpaid care per day than the richest households. Afterwards, the paper develops a simple two-period model where period-1 care inputs determine period-2 human capital, that helps show that neglecting the feedback of care can have a consequence of socially mediocre outcomes. Finally, it highlights policy interventions that include paid stipends, expanded public early childhood services and conditional cash transfers that all serve to realign the private incentives of individuals with long term efficiency in mind. The framework of the paper highlights how integrating feminist concerns into a much more dynamic neoclassical model now can guide policies to value and redistribute care and ultimately narrow international inequality.