Moving Beyond Correlations in Assessing the Consequences of Poverty

Abstract

In the United States, does growing up in a poor household cause negative developmental outcomes for children? Hundreds of studies have documented statistical associations between family income in childhood and a host of outcomes in childhood, adolescence, and adulthood. Many of these studies have used correlational evidence to draw policy conclusions regarding the benefits of added family income for children, in particular children in families with incomes below the poverty line. Are these conclusions warranted? After a review of possible mechanisms linking poverty to negative childhood outcomes, we summarize the evidence for income’s effects on children, paying particular attention to the strength of the evidence and the timing of economic deprivation. We demonstrate that, in contrast to the nearly universal associations between poverty and children’s outcomes in the correlational literature, impacts estimated from social experiments and quasi-experiments are more selective. In particular, these stronger studies have linked increases in family income to increased school achievement in middle childhood and to greater educational attainment in adolescence and early adulthood. There is no experimental or quasi-experimental evidence in the United States that links child outcomes to economic deprivation in the first several years of life. Understanding the nature of socioeconomic influences, as well as their potential use in evidence-based policy recommendations, requires greater attention to identifying causal effects.

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“…SES is defined as the social status resulting from the family's social standing and economic conditions, which, in turn, depend on wealth, education, occupation of parents etc. (Duncan, Morris and Rodrigues, 2011;Sandilands et al, 2014;Duncan, Magnuson and Votruba-Drzal, 2017) (section 2.2 provides a further discussion on SES). According to Legewie and DiPrete (2012), boys are more sensitive to school environment and SES than girls so that a negative SES composition of a school will negatively affect their attitudes toward school, work habits and effort, and hence their performance.…”

“…Duncan, Magnuson and Votruba-Drzal (2017) summarize three main theoretical approaches which examine the influence of poverty over child development: the family and environmental stress perspective; the resources and investments perspective; and the cultural perspective.…”

“…Investments, on the other hand, depend on the resources available to parents (time and money), their preferences and their long-or short-term orientations etc. (Becker, 1991;Duncan, Magnuson and Votruba-Drzal, 2017). Parents of poor children would therefore invest less in their children, buy fewer books and supporting school materials, but would also probably invest less time in supporting their children at and for school (as a result of inflexible jobs, unusual working hours etc.…”

“…According to this approach, poverty affects child's development and achievements through exposure to this culture along with its values and norms, but also through the everyday living environment of the children (joblessness, female-headed households, crime, gangs, sexual promiscuity, welfare dependency etc.) (Duncan, Magnuson and Votruba-Drzal, 2017).…”

Poverty Dynamics and Academic Trajectories of Children of Immigrants

“…It is well-documented that poverty is associated with a range of compromised educational outcomes for children in the realms of academic achievement [19,20,21]. Longitudinal studies indicate that children who grow up poor generally start schooling well behind their non-poor peers in terms of academic achievement, and it is challenge for them to catch up with their financially advantaged peers during subsequent school years [21].…”