Family income and child cognitive and non-cognitive development in Australia: does money matter?

Khanam, Rasheda and Nghiem, Son (2016) Family income and child cognitive and non-cognitive development in Australia: does money matter? Demography, 53 (3). pp. 597-621. ISSN 0070-3370


This article investigates whether family income affects children’s cognitive and noncognitive development by exploiting comprehensive information from the Longitudinal Study of Australian Children. We include variables that represent parental investment, parental stress, and neighborhood characteristics to examine if these factors mediate the effects of income. Using dynamic panel data, we find that family income is significantly associated with children’s cognitive skills but not with noncognitive skills. Mother’s education, parent’s physical and mental health, parenting styles, child’s own health, and presence of both biological parents are the most important factors for children’s noncognitive development. For cognitive development, income as well as parents’ education, child’s birth weight, and number of books that children have at home are highly significant factors. We also find strong evidence to support the skill formation theory that children’s previous cognitive and noncognitive outcomes are significantly related to their current outcomes.

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Item Type: Article (Commonwealth Reporting Category C)
Refereed: Yes
Item Status: Live Archive
Additional Information: Files associated with this record may not be displayed. Second place winner for the USQ School-Specific 2016 Publication Excellence Awards for Journal Articles - School of Commerce. Access to submitted version in accordance with the copyright policy of the publisher.
Faculty/School / Institute/Centre: Current - Faculty of Business, Education, Law and Arts - School of Commerce
Date Deposited: 05 Jul 2016 05:21
Last Modified: 16 Oct 2017 02:23
Uncontrolled Keywords: family income; child cognitive and noncognitive development; health inequalities; panel data; Australia
Fields of Research : 14 Economics > 1402 Applied Economics > 140208 Health Economics
Identification Number or DOI: 10.1007/s13524-016-0466-x

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