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Endowments and Investment within the Household: Evidence from Iodine Supplementation in Tanzania

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  • Achyuta Adhvaryu

    ()
    (MEPH Health Policy and Administration, Yale University)

  • Anant Nyshadham

    ()
    (Department of Economics, Yale University)

Abstract

Standard theories of resource allocation within the household posit that parents’ investments in their children reflect a combination of children’s endowments and parents’ preferences for child quality. We study how changes in children’s cognitive endowments affect the distribution of parental investments amongst siblings, using data from a large-scale iodine supplementation program in Tanzania. We find that parents strongly reinforce the higher cognitive endowments of children who received in utero iodine supplementation, by investing more in vaccinations and early life nutrition. The effect of siblings’ endowments on own investments depends on the extent to which quality across children is substitutable in parents’ utility functions. Neonatal investments, made before cognitive endowments become apparent to parents, are unaffected. Fertility is unaffected as well, suggesting that inframarginal quality improvements can spur investment responses even when the quantity-quality tradeoff is not readily observable.

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Bibliographic Info

Paper provided by Economic Growth Center, Yale University in its series Working Papers with number 998.

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Length: 46 pages
Date of creation: Jun 2011
Date of revision:
Handle: RePEc:egc:wpaper:998

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Keywords: endowments; intra-household; child health; Tanzania;

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  1. Douglas Almond & Lena Edlund & Marten Palme, 2007. "Chernobyl's Subclinical Legacy: Prenatal Exposure to Radioactive Fallout and School Outcomes in Sweden," Discussion Papers 0607-19, Columbia University, Department of Economics.
  2. Erica Field & Omar Robles & Maximo Torero, 2009. "Iodine Deficiency and Schooling Attainment in Tanzania," American Economic Journal: Applied Economics, American Economic Association, vol. 1(4), pages 140-69, October.
  3. David Cutler & Winnie Fung & Michael Kremer & Monica Singhal & Tom Vogl, 2010. "Early-Life Malaria Exposure and Adult Outcomes: Evidence from Malaria Eradication in India," American Economic Journal: Applied Economics, American Economic Association, vol. 2(2), pages 72-94, April.
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Cited by:
  1. Venkataramani, Atheendar S., 2012. "Early life exposure to malaria and cognition in adulthood: Evidence from Mexico," Journal of Health Economics, Elsevier, vol. 31(5), pages 767-780.
  2. John Parman, . "Childhood Health and Sibling Outcomes: The Shared Burden of the 1918 Influenza Pandemic," Working Papers 121, Department of Economics, College of William and Mary.
  3. Douglas Almond & Bhashkar Mazumder, 2013. "Fetal Origins and Parental Responses," Annual Review of Economics, Annual Reviews, vol. 5(1), pages 37-56, 05.
  4. Bengtsson, Niklas & Peterson, Stefan & Sävje, Fredrik, 2013. "Revisiting the Educational Effects of Fetal Iodine Deficiency," Working Paper Series, Center for Labor Studies 2013:13, Uppsala University, Department of Economics.
  5. Bengtsson, Niklas & Petersen, Stefan & Sävje, Fredrik, 2013. "Revisiting the Educational E ects of Fetal Iodine De ciency," Working Paper Series 2013:21, Uppsala University, Department of Economics.
  6. John Parman, 2013. "Childhood Health and Sibling Outcomes: The Shared Burden and Benefit of the 1918 Influenza Pandemic," NBER Working Papers 19505, National Bureau of Economic Research, Inc.
  7. Douglas Almond & Janet Currie, 2011. "Killing Me Softly: The Fetal Origins Hypothesis," Journal of Economic Perspectives, American Economic Association, vol. 25(3), pages 153-72, Summer.

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