IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Aggregate economic shocks, child schooling and child health

Listed author(s):
  • Ferreira, Francisco H. G.
  • Schady, Norbert

Do aggregate economic shocks, such as those caused by macroeconomic crises or droughts, reduce child human capital? The answer to this question has important implications for public policy. If shocks reduce investments in children, they may transmit poverty from onegeneration to the next. This paper uses a simple framework to analyze the effects of aggregate economic shocks on child schooling and health. It shows that the expected effects are ambiguous, because of a tension between income and substitution effects. The paper then reviews the recent empirical literature on the subject. In richer countries, like the United States, child health and education outcomes are counter-cyclical: they improve during recessions. In poorer countries, mostly in Africa and low-income Asia, the outcomes are pro-cyclical: infant mortality rises, and school enrollment and nutrition fall during recessions. In the middle-income countries of Latin America, the picture is more nuanced: health outcomes are generally pro-cyclical, and education outcomes counter-cyclical. Each of these findings is consistent with the simple conceptual framework. The paper discusses possible implications for expenditure allocation.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2008/08/25/000158349_20080825161803/Rendered/PDF/WPS4701.pdf
Download Restriction: no

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4701.

as
in new window

Length:
Date of creation: 01 Aug 2008
Handle: RePEc:wbk:wbrwps:4701
Contact details of provider: Postal:
1818 H Street, N.W., Washington, DC 20433

Phone: (202) 477-1234
Web page: http://www.worldbank.org/
Email:


More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as
in new window

  1. repec:pri:indrel:case_paxson_stature_status_8312006.pdf is not listed on IDEAS
  2. McKenzie, David J, 2006. "The Consumer Response to the Mexican Peso Crisis," Economic Development and Cultural Change, University of Chicago Press, vol. 55(1), pages 139-172, October.
  3. McKenzie, David J., 2003. "How do Households Cope with Aggregate Shocks? Evidence from the Mexican Peso Crisis," World Development, Elsevier, vol. 31(7), pages 1179-1199, July.
  4. Christopher J. Ruhm, 2006. "A Healthy Economy Can Break Your Heart," NBER Working Papers 12102, National Bureau of Economic Research, Inc.
  5. Harold Alderman & John Hoddinott & Bill Kinsey, 2006. "Long term consequences of early childhood malnutrition," Oxford Economic Papers, Oxford University Press, vol. 58(3), pages 450-474, July.
  6. de Janvry, Alain & Finan, Frederico & Sadoulet, Elisabeth & Vakis, Renos, 2006. "Can conditional cash transfer programs serve as safety nets in keeping children at school and from working when exposed to shocks?," Journal of Development Economics, Elsevier, vol. 79(2), pages 349-373, April.
  7. Anne Case & Christina Paxson, 2006. "Stature and status: Height, ability, and labor market outcomes," Working Papers 27, Princeton University, Woodrow Wilson School of Public and International Affairs, Center for Health and Wellbeing..
  8. repec:pri:cheawb:case_paxson_stature_status_8312006.pdf is not listed on IDEAS
  9. Elizabeth Frankenberg & Duncan Thomas & Kathleen Beegle, 1999. "The Real Costs of Indonesian Economic Crisis: Preliminary Findings from the Indonesia Family Life Surveys," Working Papers 99-04, RAND Corporation.
  10. Sarah Baird & Jed Friedman & Norbert Schady, 2009. "Aggregate Income Shocks and Infant Mortality in the Developing World," Working Papers 2010-07, The George Washington University, Institute for International Economic Policy.
  11. Duryea, Suzanne & Arends-Kuenning, Mary, 2003. "School Attendance, Child Labor and Local Labor Market Fluctuations in Urban Brazil," World Development, Elsevier, vol. 31(7), pages 1165-1178, July.
  12. Jaime Saavedra-Chanduví, 1998. "¿Crisis real o crisis de expectativas?: El empleo en el Perú antes y después de las reformas estructurales," IDB Publications (Working Papers) 7632, Inter-American Development Bank.
  13. Heckman, James J & Walker, James R, 1990. "The Relationship between Wages and Income and the Timing and Spacing of Births: Evidence from Swedish Longitudinal Data," Econometrica, Econometric Society, vol. 58(6), pages 1411-1441, November.
  14. repec:pri:indrel:case_paxson_stature_status_8312006 is not listed on IDEAS
  15. repec:pri:cheawb:case_paxson_stature_status_8312006 is not listed on IDEAS
  16. Christopher J. Ruhm, 2003. "Healthy Living in Hard Times," NBER Working Papers 9468, National Bureau of Economic Research, Inc.
  17. Claudia Goldin, 1999. "Egalitarianism and the Returns to Education during the Great Transformation of American Education," Journal of Political Economy, University of Chicago Press, vol. 107(S6), pages 65-94, December.
  18. Jean-Marie Baland & James A. Robinson, 2000. "Is Child Labor Inefficient?," Journal of Political Economy, University of Chicago Press, vol. 108(4), pages 663-679, August.
  19. del Ninno, Carlo & Lundberg, Mattias, 2005. "Treading water: The long-term impact of the 1998 flood on nutrition in Bangladesh," Economics & Human Biology, Elsevier, vol. 3(1), pages 67-96, March.
  20. Sonia Bhalotra, 2007. "Fatal Fluctuations? - Cyclicality in Infant Mortality in India," The Centre for Market and Public Organisation 07/181, Department of Economics, University of Bristol, UK.
  21. Claus Portner, 2006. "Gone With the Wind? Hurricane Risk, Fertility and Education," Working Papers UWEC-2006-19-R, University of Washington, Department of Economics, revised Feb 2008.
  22. Funkhouser, Edward, 1999. "Cyclical economic conditions and school attendance in Costa Rica," Economics of Education Review, Elsevier, vol. 18(1), pages 31-50, February.
  23. Rajeev Dehejia & Adriana Lleras-Muney, 2004. "Booms, Busts, and Babies' Health," Working Papers 250, Princeton University, Woodrow Wilson School of Public and International Affairs, Center for Health and Wellbeing..
  24. repec:pri:cheawb:adriana_booms.pdf is not listed on IDEAS
  25. Ruhm, Christopher J., 2003. "Good times make you sick," Journal of Health Economics, Elsevier, vol. 22(4), pages 637-658, July.
  26. Harold Alderman & Hans Hoogeveen & Mariacristina Rossi, 2009. "Preschool Nutrition and Subsequent Schooling Attainment: Longitudinal Evidence from Tanzania," Economic Development and Cultural Change, University of Chicago Press, vol. 57(2), pages 239-260, 01.
  27. Christina Paxson & Norbert Schady, 2005. "Child Health and Economic Crisis in Peru," World Bank Economic Review, World Bank Group, vol. 19(2), pages 203-223.
  28. Hoddinott, John & Kinsey, Bill, 2001. " Child Growth in the Time of Drought," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 63(4), pages 409-436, September.
  29. World Bank, 2000. "Health Strategy in a Post-Crisis, Decentralizing Indonesia," World Bank Other Operational Studies 15707, The World Bank.
  30. John Maluccio & John Hoddinott & Jere R. Behrman & Reynaldo Martorell & Agnes R. Quisumbing & Aryeh D. Stein, 2006. "The Impact of Nutrition during Early Childhood on Education among Guatemalan Adults," Middlebury College Working Paper Series 0614, Middlebury College, Department of Economics.
  31. Black, Sandra E. & Sokoloff, Kenneth L., 2006. "Long-Term Trends in Schooling: The Rise and Decline (?) of Public Education in the United States," Handbook of the Economics of Education, Elsevier.
  32. Norbert R. Schady, 2004. "Do Macroeconomic Crises Always Slow Human Capital Accumulation?," World Bank Economic Review, World Bank Group, vol. 18(2), pages 131-154.
  33. Christopher J. Ruhm, 1996. "Are Recessions Good For Your Health?," NBER Working Papers 5570, National Bureau of Economic Research, Inc.
  34. Janet Currie & Duncan Thomas, 1999. "Early Test Scores, Socioeconomic Status and Future Outcomes," NBER Working Papers 6943, National Bureau of Economic Research, Inc.
  35. Sharon Maccini & Dean Yang, 2009. "Under the Weather: Health, Schooling, and Economic Consequences of Early-Life Rainfall," American Economic Review, American Economic Association, vol. 99(3), pages 1006-1026, June.
  36. Robert Jensen, 2000. "Agricultural Volatility and Investments in Children," American Economic Review, American Economic Association, vol. 90(2), pages 399-404, May.
  37. Paxson, Christina & Schady, Norbert, 2004. "Child health and the 1988-92 economic crisis in Peru," Policy Research Working Paper Series 3260, The World Bank.
  38. World Bank, 2007. "Malawi : Poverty and Vulnerability Assessment, Investing in Our Future," World Bank Other Operational Studies 7555, The World Bank.
  39. Binder, Melissa, 1999. "Schooling indicators during Mexico's "Lost decade"," Economics of Education Review, Elsevier, vol. 18(2), pages 183-199, April.
  40. Ruhm, Christopher J. & Black, William E., 2002. "Does drinking really decrease in bad times?," Journal of Health Economics, Elsevier, vol. 21(4), pages 659-678, July.
  41. Thomas, Duncan & Beegle, Kathleen & Frankenberg, Elizabeth & Sikoki, Bondan & Strauss, John & Teruel, Graciela, 2004. "Education in a crisis," Journal of Development Economics, Elsevier, vol. 74(1), pages 53-85, June.
  42. Ward, Michael P & Butz, William P, 1980. "Completed Fertility and Its Timing," Journal of Political Economy, University of Chicago Press, vol. 88(5), pages 917-940, October.
  43. Kenneth Y. Chay & Michael Greenstone, 2003. "The Impact of Air Pollution on Infant Mortality: Evidence from Geographic Variation in Pollution Shocks Induced by a Recession," The Quarterly Journal of Economics, Oxford University Press, vol. 118(3), pages 1121-1167.
  44. Charles, Kerwin Kofi & DeCicca, Philip, 2008. "Local labor market fluctuations and health: Is there a connection and for whom?," Journal of Health Economics, Elsevier, vol. 27(6), pages 1532-1550, December.
  45. Yoram Ben-Porath, 1967. "The Production of Human Capital and the Life Cycle of Earnings," Journal of Political Economy, University of Chicago Press, vol. 75, pages 352-352.
  46. Julian R. Betts & Laurel L. McFarland, 1995. "Safe Port in a Storm: The Impact of Labor Market Conditions on Community College Enrollments," Journal of Human Resources, University of Wisconsin Press, vol. 30(4), pages 741-765.
  47. Duryea, Suzanne & Lam, David & Levison, Deborah, 2007. "Effects of economic shocks on children's employment and schooling in Brazil," Journal of Development Economics, Elsevier, vol. 84(1), pages 188-214, September.
  48. Stillman, Steven & Thomas, Duncan, 2004. "The Effect of Economic Crises on Nutritional Status: Evidence from Russia," IZA Discussion Papers 1092, Institute for the Study of Labor (IZA).
  49. Glewwe, Paul & Hall, Gillette, 1994. "Poverty, Inequality, and Living Standards during Unorthodox Adjustment: The Case of Peru, 1985-1990," Economic Development and Cultural Change, University of Chicago Press, vol. 42(4), pages 689-717, July.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:4701. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.