Distal family factors
of the extent of the income effect, researchers have been concerned to establish
whether the duration and timing of poverty affect children’s educational attainments.
Are children who always lived in poverty more likely to underachieve in school than
children who lived in and out of poverty? Does poverty have worse effects on
educational attainment if it occurs during childhood than during adolescence?
Empirical studies have found the effects of income on children’s attainment to be
substantial but importantly non-linear (Gregg & Machin, 2000; Hobcraft, 1998).
Below a threshold of income the effects of poverty on children’s attainments and
behaviour are large and long-term. Above this threshold additional increments to
income have less substantial effects although where resources are spent on
educational provision for children these continue to have wide-ranging benefits. Still,
the effects of wider material deprivation may not be completely captured by income.
Wider material deprivation includes:
i. lack of access to institutions;
ii. lack of physical assets;
iii. financial assets (McCulloch & Joshi, 1999).
One important feature of poverty for children’s developmental outcome is the
duration of poverty. Some studies have found that experience of income poverty
during childhood has long-term detrimental effects on educational attainments
(Duncan & Brooks-Gunn, 1997; Gregg & Machin, 2000). Other studies have found
that regardless of the timing of the event, one of the dimensions of poverty proxied by
parental unemployment has detrimental effects on children’s educational attainment
(Ermisch & Francesconi, 2002).
In summary, there is clear evidence that not only does the timing of poverty affect
outcomes but so does the duration of poverty. Those children who always live in
poverty face the highest risk of school under-attainments. In the US studies have
shown that these children have the highest probability of dropping out of school
(Haveman et al., 1997). Both in the US and in the UK children living in and out of
poverty are also at risk compared to children who have always lived out of poverty
(Haveman et al., 1997) (Hobcraft, 1998).
5.5.2 The effects of prior parental education on income and poverty
There is a large body of literature that links educational attainment to income and we
do not review it fully here. Useful sources are: (Blundell & Macurdy, 1999; Blundell
et al., 2003; Card, 1999) for estimates of the causal returns to education; (Dearden et
al., 2003) for changes in income over time induced by education; (Heckman &
Vytlacil, 2001) for the role of ability in explaining changes in returns to education.
The Centre for Economics of Education (CEE) has carried out systematic analysis to
estimate the relationship between learning and returns to education in the UK. The
research has been carefully designed to control for confounding factors that affect
both education and future returns such as ability. Longitudinal datasets and large scale
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