Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/34900 
Year of Publication: 
2008
Series/Report no.: 
IZA Discussion Papers No. 3520
Publisher: 
Institute for the Study of Labor (IZA), Bonn
Abstract: 
Identifying the effect of parental incomes on child outcomes is difficult due to the correlation of unobserved ability, education levels and income. Previous research has relied on the use of instrumental variables to identify the effect of a change in household income on the young adult outcomes of the household´s children. In this research, we examine the role that an exogenous increase in household incomes due to a government transfer unrelated to household characteristics plays in the long run outcomes for children in affected households. We find that children who are in households affected by the cash transfer program have higher levels of education in their young adulthood and a lower incidence of criminality for minor offenses. These effects differ by initial household poverty status as is expected. Second, we explore two possible mechanisms through which this exogenous increase in household income affects the long run outcomes of children - parental time (quantity) and parental quality. Parental quality and child interactions show a marked improvement while changes in parental time with child does not appear to matter.
Subjects: 
Cash transfer programs
quasi-experiment
educational attainment
criminality
difference-in-differences
panel data
JEL: 
J24
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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