How can income affect a childs development

While a parent's level of education, attitude towards bringing up children and other parental factors also have a bearing, research shows that having more money directly improves the development and level of achievement of children. Increases in family income substantially reduce differences in schooling outcomes and improve wider aspects of a child's well-being.

Cognitive development and school achievement were most improved by having more money. Conversely, reductions in family income, including benefit cuts, are likely to have wide-ranging negative effects.

Money seems to have more of an effect among low-income families. Handle: RePEc:cep:sticar:casereport80 as. Corrections All material on this site has been provided by the respective publishers and authors. Louis Fed. And how long do the effects last? For child health, our evidence base suggests the period before birth is particularly important, but effects on educational and social-behavioural outcomes are also found for older children and teenagers see Cooper and Stewart for further discussion.

But there is also evidence that increased welfare payments in the US had more impact on school achievement 2—5 years on than in the initial assessment Clark-Kauffman et al. While the findings from the studies in this review tell a powerful story, the evidence base has limitations. Despite extensive searches, only 54 studies met the inclusion criteria, representing a total of 19 experimental or quasi-experimental situations plus observational analysis of 10 longitudinal datasets. There is also less evidence on some outcomes than others, with only a handful of studies on each of the intermediate mechanisms, and less evidence on health and social, behavioural and emotional outcomes than on cognitive attainment and schooling.

In seeking to address these gaps, researchers should pay attention to the crucial finding that the size of identified effects appears highly sensitive to the methods used. Studies exploiting experiments or other sources of exogenous changes in income identify effect sizes that are greater than those using fixed effect techniques on longitudinal data. This is likely at least in part to be related to the stronger likelihood of measurement error in studies relying on reported income in household survey data, and by the fact that fixed effect studies are not able to deal as adequately with the problem of omitted variable bias.

The scale of the apparent downward bias in results raises questions about how useful these methods are to establish the existence and size of income effects and underlines the importance of creative researchers continuing to identify quasi-experimental situations to study. Despite these limitations, the policy implications from the existing evidence are clear and important: policies to support household income have a key role to play in any strategy to improve life chances for children from disadvantaged backgrounds.

Even very small income effects operating across this range of domains are likely to add up to a larger cumulative impact. Akee, R. American Economic Journal: Applied Economics, 2 , 86— Google Scholar. Allison, P. Fixed effects regression methods for longitudinal data using SAS. Angrist, J. Princeton: Princeton University Press. Averett, S.

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This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information. Non-necessary Non-necessary. Few trends are more ominous than the increases in both the class gaps and achievement gaps between low- and high-income children in the United States. The rising income-based achievement gaps call into question whether the American Dream of intergenerational mobility is now beyond the reach of many children raised in low-income families.

Policy approaches to addressing increasing disparities in outcomes for children from low- and high-income families can take a number of forms. Such approaches can be pursued simultaneously. Some experimental evaluations of the program show it reduces child maltreatment. Mothers in the control group, in contrast, had on average 0.

The Nurse-Family Partner program also yields long-run benefits for some children. By age 19, girls in the treatment group had fewer arrests and convictions; a subset of these girls had fewer children and less Medicaid use than their comparison group counterparts. The United States has made little progress toward narrowing the achievement gap between advantaged and disadvantaged children.

Duncan Eds. Duncan and R. Murnane Eds. Sean F. Robert H. Bradley, Robert F. Corwyn, Harriet P. Rand D. Conger and Katherine J. Pinderhughes, K. Dodge, J. Bates, G. Pettit, A. Lareau, Unequal Childhoods.