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The long‐run effect of childhood poverty and the mediating role of education

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  • Luna Bellani
  • Michela Bia

Abstract

The paper examines the role of education as a causal channel through which growing up poor affects the economic outcomes in adulthood in the European Union. We apply a potential outcomes approach to quantify those effects and we provide a sensitivity analysis on possible unobserved confounders, such as child ability. Our estimates indicate that being poor in childhood significantly decreases the level of income in adulthood and increases the average probability of being poor. Moreover, our results reveal a significant role of education in this intergenerational transmission. These results are particularly relevant for Mediterranean and central and eastern European countries.

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  • Luna Bellani & Michela Bia, 2019. "The long‐run effect of childhood poverty and the mediating role of education," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 182(1), pages 37-68, January.
    • Handle: RePEc:bla:jorssa:v:182:y:2019:i:1:p:37-68
    DOI: 10.1111/rssa.12388
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    Cited by:

    1. Yang Wei & Zhouping Li & Yunqiu Dai, 2022. "Unified smoothed jackknife empirical likelihood tests for comparing income inequality indices," Statistical Papers, Springer, vol. 63(5), pages 1415-1475, October.
    2. Helmut Farbmacher & Martin Huber & Lukáš Lafférs & Henrika Langen & Martin Spindler, 2022. "Causal mediation analysis with double machine learning [Mediation analysis via potential outcomes models]," The Econometrics Journal, Royal Economic Society, vol. 25(2), pages 277-300.
    3. Carranza, Rafael & Nolan, Brian & Bavaro, Michele, 2023. "Intergenerational Poverty Persistence in Europe - Is There a 'Great Gatsby Curve' for Poverty?," INET Oxford Working Papers 2023-22, Institute for New Economic Thinking at the Oxford Martin School, University of Oxford, revised Dec 2023.
    4. Hofmarcher, Thomas, 2021. "The effect of education on poverty: A European perspective," Economics of Education Review, Elsevier, vol. 83(C).
    5. Martin Huber & Mark Schelker & Anthony Strittmatter, 2022. "Direct and Indirect Effects based on Changes-in-Changes," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 40(1), pages 432-443, January.
    6. Patrick Ring & Christoph A. Schütt & Dennis J. Snower, 2023. "Care and anger motives in social dilemmas," Theory and Decision, Springer, vol. 95(2), pages 273-308, August.
    7. Tang, Jianjun & Gong, Jiaowei & Ma, Wanglin & Rahut, Dil Bahadur, 2022. "Narrowing urban–rural income gap in China: The role of the targeted poverty alleviation program," Economic Analysis and Policy, Elsevier, vol. 75(C), pages 74-90.
    8. Micheál L. Collins, 2022. "Revealing a Hidden Cost: determining the public service cost of poverty in Ireland," Working Papers 202205, Geary Institute, University College Dublin.
    9. Ana I. Moro Egido & Maria Navarro, 2023. "Intergenerational Transmission of Economic Strain and High School Dropout," ThE Papers 23/07, Department of Economic Theory and Economic History of the University of Granada..

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