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Understanding the relationship between parental income and multiple child outcomes: A decomposition analysis

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  • Paul Gregg
  • Carol Propper
  • Elizabeth Washbrook

Abstract

In this paper we explore the association between family income and children's cognitive ability (IQ and school performance), socio-emotional outcomes (self esteem, locus of control and behavioural problems) and physical health (risk of obesity). We develop a decomposition technique that allows us to compare the relative importance of the adverse family characteristics and home environments of low income children in accounting for different outcomes. Using rich cohort data from the UK we find that poor children are disadvantaged at age 7 to 9 across the full spectrum of outcomes, the gradient being strongest for cognitive outcomes and weakest for physical health. We find that some aspects of environment appear to be associated with the full range of outcomes - for example, maternal smoking and breastfeeding, child nutrition, parental psychological functioning. We also find some some aspects of the environment of higher income households hinder child development. We conclude that many aspects of growing up in poverty are harmful to children's development, and that narrowly-targeted interventions are unlikely to have a significant impact on intergenerational mobility.

Suggested Citation

  • Paul Gregg & Carol Propper & Elizabeth Washbrook, 2007. "Understanding the relationship between parental income and multiple child outcomes: A decomposition analysis," CASE Papers case129, Centre for Analysis of Social Exclusion, LSE.
  • Handle: RePEc:cep:sticas:case129
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    File URL: http://sticerd.lse.ac.uk/dps/case/cp/CASEpaper129.pdf
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Fauth, Rebecca & Parsons, Samantha & Platt, Lucinda, 2014. "Convergence or divergence?: a longitudinal analysis of behaviour problems among disabled and non-disabled children aged 3 to 7 in England," LSE Research Online Documents on Economics 59659, London School of Economics and Political Science, LSE Library.
    2. Ferreyra, Maria Marta & Liang, Pierre Jinghong, 2012. "Information asymmetry and equilibrium monitoring in education," Journal of Public Economics, Elsevier, vol. 96(1), pages 237-254.
    3. Simon Burgess & Eleanor Sanderson & Marcela Umana-Aponte, 2011. "School ties: An analysis of homophily in an adolescent friendship network," The Centre for Market and Public Organisation 11/267, Department of Economics, University of Bristol, UK.

    More about this item

    Keywords

    child outcomes; income; pathways; mediating factors;

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth

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