Changes in Parental Assets and Children's Educational Outcomes

Abstract

Abstract 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 achievements 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 faster asset accumulation is associated with changes in reading scores, but not in math scores. Overall, the results suggest that the relationship between assets and various child outcomes may not be straight-forward. 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.