Experimental Evidence on Intergenerational Transmission of Economic Status

University Of California-Berkeley, Berkeley CA

Investigators

Abstract

The persistence of health disparities and poverty is a major global economic policy issue. Despite this, relatively little is known about the intergenerational transmission of economic status and human capital, in part due to limited data. This study will provide causal evidence of the long-term and intergenerational impacts of child health interventions, assessing whether a health and human capital intervention has the potential to improve recipients’ adult socioeconomic status as well as life outcomes of their children. In addition, the research will use the rich longitudinal survey data collected for the project to study potential mechanisms through which adult life changes may translate into intergenerational impacts, and whether these effects differ by gender or socioeconomic status. The results of this research have important implications for public policy design regarding approaches to promote intergenerational mobility and reduce persistent economic inequalities. The results could also inform policies to reduce wealth inequalities across socioeconomic groups over time. This research utilizes both experimental and non-experimental variation to examine the long-term and intergenerational returns to child health investments, by combining randomized interventions with a 26-year longitudinal dataset containing detailed information on both program participants and their children. This project extends data collection of a school-based deworming intervention and a randomized cash grants intervention for 6,500 program participants (who were aged 8-15 in 1998), to create a novel intergenerational panel dataset. Using this dataset, the research will study the potential mechanisms driving the intergenerational transmission of economic status, including human capital, economic preferences, and attitudes, living standards and economic status, and parental investment decisions. Understanding these intergenerational drivers of child well-being has important implications for public policies to assist marginalized individuals in escaping poverty and improving health in both the US and internationally. The results have important implications for public policy design regarding approaches to promote intergenerational mobility and reduce persistent economic inequalities. The results could also inform policies to reduce wealth inequalities across socioeconomic groups over time. This award reflects NSF's statutory mission and has been deemed worthy of support through evaluation using the Foundation's intellectual merit and broader impacts review criteria.