The life cycle of early skill formation

• Main Author: Tominey, E.
• Published: University College London (University of London) 2010
• Subjects: 330
• Online Access: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.565031

This thesis focuses on two dimensions of the child production function - the technology of human capital formation and the role of speci…fic family inputs into human capital. The …first two chapters explore the technology by which inputs produce child human capital. Speci…fically, for given parental lifetime income, these ask whether the timing of income matters for later outcomes of the children. Two methodologies estimate the effect at different margins. Firstly in a fully flexible model, the relationship between parental income at child ages 0-5, 6-11 and 12-17 and subsequent child outcomes is estimated nonparametrically, allowing for complementarity across periods. Income aged 0-5 is as important in general as income at age 6-11 for child human capital formation. Complementarities exist between 0-5 and 6-11 for households with low permanent income, which are those likely to be credit constrained. Similarly, very strong complementarities are found between early years income and income during adolescence (age 12-17) for the group of poor parents. Chapter 3 analyses the role of permanent and transitory income shocks at different ages, upon adolescent human capital. Empirical results suggest the effect of permanent shocks declines across age. This is intuitive, given that a permanent shock changes household wealth and hence a shock at age 1 drives more future income realisations than a later shock. Transitory shocks on the other hand, have an increasing effect upon child outcomes across child age. Further, there is evidence of intrahousehold insurance against paternal transitory income shocks. The fi…nal two chapters of the thesis look at parental inputs in the production function. Chapter 4 allows the life cycle of skill formation to begin pre-birth, by estimating the role of maternal smoking during pregnancy upon birth outcomes. Results suggest a large proportion of the correlation is explained by a maternal fi…xed effect. Finally, chapter 5 offers a cross country comparison of the similarities in child test score gaps, by a range of measures of family inequality. Despite wide institutional differences, this chapter estimates homogeneous correlates for maternal education, family size and child gender upon child achievement, but differences in the covariates of lone parenthood and ethnicity.