Asset Building Financial Inclusion Working Paper

Testing Universal Child Development Accounts: Financial Impacts in a Large Social Experiment

This study examines financial impacts of Child Development Accounts (CDAs) designed to build assets for every newborn in the treatment group. Data come from the randomized SEED for Oklahoma Kids experiment 7 years after the intervention began. The CDA’s automatic features have large impacts on account holding and asset accumulation for college, and especially so for disadvantaged children. This is an important finding because having designated college savings likely shapes children’s educational expectations, which in turn likely influences their precollege academic behavior and achievement. Moreover, demonstrating full inclusion—that is, accounts and assets for all newborns—sets the stage for more equitable distribution of public resources. The CDA also increases the likelihood that parents themselves save for their children’s future college expenses.

Subsequent publication: Clancy, M. M., Beverly, S. G., Sherraden, M., & Huang, J. (2016). Testing universal Child Development Accounts: Financial effects in a large social experiment. Social Service Review, 90(4), 683–708. doi:10.1086/689756

Citation

Clancy, M. M., Beverly, S. G., Sherraden, M., & Huang, J. (2016). Testing universal Child Development Accounts: Financial impacts in a large social experiment (CSD Working Paper No. 16-08). St. Louis, MO: Washington University, Center for Social Development.