The relationship between income and children*s outcomes: a

The relationship between
income and children’s
outcomes: a research
synthesis of evidence from
CRDCN National Conference 2012 – Fredericton, NB Oct 23-24
Annie McEwen (presenting) and Jennifer Stewart
School of Public Policy and Administration
• CRDCN Research Syntheses
• Why a child outcomes synthesis?
• Synthesis focus and research questions
• Criteria for research inclusion
• Family income and cognitive outcomes
• Methodologies
• Data
• Policy implications
• Research implications
• Questions and next steps
A CRDCN Synthesis Project
• peer-reviewed publications written by subject
• available in English and French
• written in plain language suitable for a general
• assess the strength and implications of existing
empirical research in relation to key policy
CRDCN Synthesis Objectives
• ensure that research results are absorbed by
policy-makers and the public;
• help ensure that the RDC program and Statistics
Canada’s surveys contribute to the development
and adoption of knowledge-informed policy;
• identify key evidence gaps in order to encourage
policy-relevant research
For more information see:
Why a synthesis on income and child
• Policy & public attention to children and child
development research eg. child care (UCCB), allday-kindergarten
• Increasing concern about roots of inequality and
social mobility in childhood
• A focus on child development as ‘human capital’
• Research affects how policy views children
• NLSCY completion: how far have we gotten in
understanding this relationship?
Synthesis research questions
1. How has income been shown to affect different
dimensions of child outcomes (e.g. health,
behaviour, educational attainment)?
2. What variables have been found to either
moderate or mediate the effect of income on
child outcomes?
3. What methods have studies used to examine the
causality of the relationship between income and
outcomes, and how effectual have they been?
4. What are future data needs and research
Criteria for inclusion
• Canadian data:
– National Longitudinal Survey of Children and Youth (NLSCY)
– L’Étude longitudinale du développement des enfants du
– Youth in Transition Survey (YITS)
– Ontario Child Health Survey (OCHS)
• Income as key independent variable (not just
control) or major part of findings
• Longitudinal element in data analysis
• Outcome areas: Cognitive, Social-emotional,
Behavioural, Physical/Health
Income & Cognitive Outcomes:
Main effects
• Cognitive outcomes:
Pearson-Peabody Vocabulary Test (Revised)
Math and reading tests
Standardized (provincial) curriculum test
Grade completion, high school completion, PSE
• Undisputed association, but cause and magnitude?
• High intergenerational income mobility in Canada,
three times that of USA (Corak, Curtis, and Phipps 2011)
• Magnitude of ‘direct’ income effect smaller once other
SES factors taken into accounted (Curtis and Phipps
2000; Dooley and Stewart 2004, 2007, Blau 1999, Mayer 1997)
• Income has little effect on post-secondary education
choices (Lefebvre and Merrigan 2008, 2010)
Income & Cognitive Outcomes:
• Parenting style (Thomas 2006, Guo and Mullan Harris 2000)
• Parental time (Curtis and Phipps 2000, Duncan et al. 2010)
• Source of income (Dooley and Stewart 2004, 2007)
• Child activities/spending (Thomas 2006, Yeung et al.
• Child and parent health (Contoyannis and Dooley 2010)
• Family emotional well-being (Milligan and Stabile 2008,
Income & Cognitive Outcomes:
• Stronger correlation between income and cognition
than other outcomes (Phipps and Lethbridge 2006, Duncan and
Brooks-Gunn 1997)
• Trajectories and persistence (Lloyd and Hertzman 2009,
Santos et al. 2012, Hoddinnott et al. 2002, Roberts et al. 2001)
• Timing matters, early poverty worse (Hoddinnott et al. 2002,
Duncan and Brooks-Gunn 1997)
• Gendered impacts – bigger cognitive effect for boys
(Milligan and Stabile 2008)
• Duration of low-income matters. High turnover for kids,
but persistent poverty more strongly correlates with
worse outcomes (Phipps and Lethbridge 2006, Hoddinnott et al. 2002)
Roberts et al. 2001)
• Difficulty of managing unobserved heterogeneity
• Use of exogenous policy changes, before/after and
diff-in-diffs (Milligan and Stabile 2008, 2009; Williamson and Salkie
2005, Lefebvre and Merrigan 2002, 2008, 2011, Dooley and Stewart 2007)
• Fixed effects, adoptive/biological, income treatments
(Dooley and Stewart 2004, 2007, Mayer 1997)
• Diverse income measures: permanent/averages,
cross-sectional, lagged, pre-/post-transfer and tax,
earned/social assistance, census area SES
• Functional form of income used matters, and may
change with age (Phipps and Lethbridge 2006)
Issues with Canadian data
• How good are these cognitive measures?
• Direct observations/tests vs. reporting
• Inclusion of policy within data collection vs. imputation–
which programs are individuals actually using?
• Need for longitudinal data with more frequent and longer
• Sampling and attrition – difficulty accounting for bias
• Need for census for reference group/weighting
• Child expenditure measures, connected to outcomes
• Blind spots: First Nations children, children out of family
• Administrative data? Linking? (BC & Manitoba EDI)
Policy implications: Cognitive outcomes
“Policies that affect family income will have little direct impact on
child development unless they result in very large and permanent
changes in income” (Blau 1999, USA)
• Value of income transfers for direct effects on cognition
are small. Indirect effects hard to pinpoint.
• Evidence of parenting/family functioning mediation
supports family services and programs as alternatives
to income transfers (efficiency unclear).
• Varying effect of income at different ages of childhood
supports differentiation in policies for different ages,
rather than 0-18 (eg. child benefits)
• Trajectories set early, potential for targeted programs
• Kids can change trajectories, no clear “too late” point
Filling Canadian research gaps
• Emphasis to date on younger kids – IQ, ‘school
readiness’ rather than outcomes or academic attainment
• How important are cognitive outcomes and how do they
connect with other factors? (Tough 2012)
• Population level research, environmental, peer or school
effects (Lloyd and Hertzman 2009, Santos et al. 2012)
• Dynamic research – what are the effects of change?
• Differentiating between earned and transferred income
• Income vs. wealth or assets
• Are there studies/data we should
be including?
• What do you see as the
research/data gaps in this area?
• What policy implications can we
Next steps and contact info
• Completion of literature review, annotated bibliography
and synthesis drafting
• Peer review of synthesis by CRDCN
• Publication to CRDCN website and policy journal
(Spring 2013)
Annie McEwen and Jennifer Stewart
School of Public Policy and Administration, Carleton
University, Ottawa
[email protected]
[email protected]
(presentation, not complete synthesis)
Blau, David (1999), 'The effect of income on child development', Review of Economics and Statistics, 81 (2), 261-76.
Contoyannis, Paul and Dooley, Martin (2010), 'The role of child health and economic status in educational, health, and
labour market outcomes in young adulthood
', Canadian Journal of Economics/Revue canadienne d'économique, 43 (1), 323-46.
Corak, Miles, Curtis, Lori, and Phipps, Shelley (2011), 'Economic Mobility, Family Background, and the Well-Being of
Children in the United States and Canada', in Timothy M. Smeeding, Robert Erikson, and Markus Jänti (eds.), Persistence,
Privilege, and Parenting (Russell Sage Foundation), 73-108.
Curtis, Lori and Phipps, Shelley (2000), 'Economic Resources and Children’s Health and Success at School: An Analysis Using
the NLSCY', in Human Resources Development Canada (ed.), (Ottawa: Human Resources Development Canada).
Dooley, Martin and Stewart, Jennifer (2004), 'Family income and child outcomes in Canada', Canadian Journal of Economics,
37 (4), 898-917.
--- (2007), 'Family income, parenting styles and child behavioural-emotional outcomes', Health Economics, 16 (2), 145-62.
Duncan, Greg J. and Brooks-Gunn, Jeanne (1997), Consequences of growing up poor (New York: Russell Sage Foundation).
Duncan, Greg J., Kalil, Ariel, and Ziol‐Guest, Kathleen (2010), 'Early‐Childhood Poverty and Adult Attainment, Behavior, and
Health', Child Development, 81 (1), 306-25.
Guo, Guang and Mullan Harris, Kathleen (2000), 'The Mechanisms Mediating the Effects of Poverty on Children’s
Intellectual Development', Demography, 37 (4), 431-47.
Hoddinnott, John, Lethbridge, Lynn, and Phipps, Susan (2002), 'Is History Destiny? Resources, Transitions and Child
Education Attainments in Canada', (Ottawa: Human Resources Development Canada).
Lefebvre, Pierre, Merrigan, Philip, and Roy-Desrosiers, Francis (2011), 'Quebec's Childcare Universal Low Fees Policy 10
Years After: Effects, Costs and Benefits', Centre Interuniversitaire sur le Risque, les Politiques Economiques et l'Emploi
(CIRPEE) Working Paper. <, accessed May 2011.
Lloyd, Jennifer E. V. and Hertzman, Clyde (2009), 'From Kindergarten readiness to fourth-grade assessment: Longitudinal
analysis with linked population data', Social Science & Medicine, 68 (1), 111-23.
References cont’d
(presentation, not complete synthesis)
Mayer, Susan E. (1997), What money can't buy: family income and children's life chances (Cambridge: Harvard University Press).
McEwen, Annie (2011), 'Beyond child poverty: following the evidence to a multidimensional approach to childhood disadvantage',
in Guy Fréchet, Danielle Gauvreau, and Jean Poirier (eds.), Social Statistics, Poverty and Social Exclusion: Perspectives from
Quebec, Canada and Abroad (Montreal: Les Presses de l’Universite de Montreal).
Milligan, Kevin and Stabile, Mark (2008), 'Do Child Tax Benefits Affect the Wellbeing of Children? Evidence from Canadian Child
Benefit Expansions', NBER Working Paper Series, No. 14624.
--- (2009), 'Child Benefits, Maternal Employment, and Children's Health: Evidence from Canadian Child Benefit Expansions',
American Economic Review, 99 (2), 128.
Phipps, Shelley and Lethbridge, Lynn (2006), 'Income and the Outcomes of Children', in Statistics Canada (ed.), Analytical Studies
Branch Research Paper Series (Ottawa: Statistics Canada).
Roberts, Paul, Smith, Peter, and Nason, Holly (2001), 'Children and Familial Economic Welfare: The Effect of Income on Child
Development', in Applied Research Branch Strategic Policy Human Resources Development Canada (ed.), (Ottawa).
Santos, Rob, et al. (2012), 'The Early Development Instrument (EDI) in Manitoba: Linking Socioeconomic Adversity and Biological
Vulnerability at Birth to Children’s Outcomes at Age 5', in Manitoba Centre for Health Policy (ed.), (Winnipeg, MB).
Thomas, Eleanor (2006), 'Readiness to Learn at School Among Five-year-old Children in Canada', Children and Youth Researcher
Series (Ottawa: Statistics Canada).
Tough, Paul (2012), How Children Succeed: Grit, Curiosity, and the Hidden Power of Character (Boston: Houghton Mifflin Harcourt).
Williamson, Deanna L. and Salkie, Fiona (2005), 'Welfare reforms in Canada: Implications for the well-being of pre-school children
in poverty', Journal of Children & Poverty, 11 (1), 55-76.
Yeung, W. Jean, Linver, Miriam, R. , and Brooks-Gunn, Jeanne (2002), 'How money matters for young children's development:
Parental investment and family processes', Child development, 73 (6), 1861-79.

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