Asset Building Financial Inclusion Working Paper

Parental Assets and Children’s Educational Outcomes

Several countries, including Canada, Singapore and the United Kingdom, have enacted asset-based policies for children in recent years. The premise underlying these policies is that increases in assets lead to improvement in various child outcomes over time. But little existing research examines this premise from a dynamic perspective. Using data from the NLSY79 mother and child datasets, two parallel process latent growth curve models are estimated to examine the effects of parental asset accumulation on changes in children’s math and reading achievement over six years during middle childhood. Results indicate that the initial level of assets is positively associated with math scores but not reading scores, while higher rates of asset accumulation are associated with slower rates of decline in reading scores but has no effect on changes in math scores. Overall, the results suggest that the relationship between assets and various child outcomes may not be straightforward. Different dimensions of the asset experience may lead to different outcomes, and the same dimension may also have different effects. Implications for future research and for asset-based policies are discussed.

Subsequent publication: Loke, V., & Sacco, P. (2011). Changes in parental assets and children’s educational outcomes. Journal of Social Policy, 40(2), 351–368. doi:10.1017/S0047279410000516

Citation

Loke, V., & Sacco, P. (2009). Parental assets and children’s educational outcomes (CSD Working Paper No. 09-17). St. Louis, MO: Washington University, Center for Social Development.