The Effect of Family Income on Children's Education: Some Findings on Inequality of Opportunity

Abstract

In this paper an attempt is made to estimate the degree of inequality of educational opportunity at the secondary school level. Data from the 1/1, 000 sample of the 1960 Census are used to estimate the probabilities of falling behind in school or dropping out for children from different family backgrounds. For children whose parents have little education or income, the probabilities are more than 20 times greater than for children from well-to-do families where both parents have graduated from high school. The determinants of the dropout and retardation rates are also investigated, with the discussion focusing on the possible effects of new transfer programs, such as the negative income tax. While the short-run effects are likely to be quite small, the long-run effects may be important, especially for the Negro retardation rate.