result clearly shows that the treated plant water has the greatest impact when it is available in early childhood, in particular, at age two and younger. For example, on average a child’s final educational achievement increases by 1.69 years if he/she starts to use plant water before 2 years old. And this impact decreases to 0.4 to 0.6 year when the earliest exposure age is older than age 2. The treatment effect stays more or less flat after age two. In Figure 4 we plot the coefficients and their 90 percent confidence intervals of those dummy treatment variables indicating a child’s earliest exposure age.<sup>43</sup> The finding of the highest return at the pre-school stage (i.e., birth to age 2) is consistent with the literature that suggest that the largest return to human capital investment comes at the early childhood (Heckman, 2008; Almond and Currie, 2011). We add to this literature by showing that exposure to treated plant water also exhibit highest return to education at the early childhood stage.<sup>44</sup>

# **Heterogeneous Treatment Effects across Gender**

During the sample period, rural Chinese girls on average are less educated than boys. In our data, the average grades of education completed is 8.54 years for girls versus 8.85 years for boys, and 63.4 and 15.9 percent of girls are graduates of middle and high schools, respectively, as compared to 68.1 and 16.8 percent for boys. Can health improvement programs such as the rural drinking water treatment program significantly reduce the gender gap? The brawn theory of division of labor (Pitt et al., 2012) would imply so. To answer this question, we explore the heterogeneous treatment effects for boys and girls.

> Table 10 presents the results for boys and girls separately. In general, the treatment effects on girls are substantially larger than those on boys. For example, the grades completed

> 43 We have also explored the treatment effects of this water program in a parametric method. First, we construct a continuous variable which equals to (26-earliest exposure age)/10 and coded this variable as zero for all of the individuals who do not have access to plant water before 25. This definition of this variable implies that exposure to plant water after 26 is zero. We then substitute the polynomial terms of exposure age up to the 3<sup>rd</sup> order for the simple dummy treatment variable—Water Plant--in the baseline regression with the outcome of grade of education completed. The regression results confirm that the largest impact is felt at the early childhood years, after which the impact is much more contained.

> 44 A counter-intuitive finding here is that the treatment effects of treated water on individuals who were first exposed to treated water between age 20 and 25 remain positive and significant.  Our explanation is that late enrollments often happen in undeveloped areas. For example, children at 12 years old are supposed to have finished primary schools or at least are at the 6<sup>th</sup> grade in school. However, the CHNS data shows that more than 35 percent of the twelve-year olds study at the 5<sup>th</sup> grade,  around 13 percent at the 4<sup>th</sup> grade, and 6 percent at the 3<sup>rd</sup> grade or below.

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