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Endowments and Investments within the Household: Evidence from Iodine Supplementation in Tanzania

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  • Adhvaryu, Achyuta
  • Nyshadham, Anant

Abstract

Standard theories of resource allocation within the household posit that parents’ investments in their children reflect a combination of children’s endowments and parents’ preferences for child quality. We study how changes in children’s cognitive endowments affect the distribution of parental investments amongst siblings, using data from a large-scale iodine supplementation program in Tanzania. We find that parents strongly reinforce the higher cognitive endowments of children who received in utero iodine supplementation, by investing more in vaccinations and early life nutrition. The effect of siblings’ endowments on own investments depends on the extent to which quality across children is substitutable in parents’ utility functions. Neonatal investments, made before cognitive endowments become apparent to parents, are unaffected. Fertility is unaffected as well, suggesting that inframarginal quality improvements can spur investment responses even when the quantity-quality tradeoff is not readily observable.

Suggested Citation

  • Adhvaryu, Achyuta & Nyshadham, Anant, 2011. "Endowments and Investments within the Household: Evidence from Iodine Supplementation in Tanzania," Center Discussion Papers 107270, Yale University, Economic Growth Center.
    • Handle: RePEc:ags:yaleeg:107270
    DOI: 10.22004/ag.econ.107270
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    Cited by:

    1. Douglas Almond & Bhashkar Mazumder, 2013. "Fetal Origins and Parental Responses," Annual Review of Economics, Annual Reviews, vol. 5(1), pages 37-56, May.
    2. John Parman, "undated". "Childhood Health and Sibling Outcomes: The Shared Burden of the 1918 Influenza Pandemic," Working Papers 121, Department of Economics, College of William and Mary.
    3. John Parman, 2013. "Childhood Health and Sibling Outcomes: The Shared Burden and Benefit of the 1918 Influenza Pandemic," NBER Working Papers 19505, National Bureau of Economic Research, Inc.
    4. Bengtsson, Niklas & Peterson, Stefan & Sävje, Fredrik, 2013. "Revisiting the Educational Effects of Fetal Iodine Deficiency," Working Paper Series, Center for Labor Studies 2013:13, Uppsala University, Department of Economics.
    5. Bengtsson, Niklas & Petersen, Stefan & Sävje, Fredrik, 2013. "Revisiting the Educational E ects of Fetal Iodine De ciency," Working Paper Series 2013:21, Uppsala University, Department of Economics.
    6. Venkataramani, Atheendar S., 2012. "Early life exposure to malaria and cognition in adulthood: Evidence from Mexico," Journal of Health Economics, Elsevier, vol. 31(5), pages 767-780.
    7. Douglas Almond & Janet Currie, 2011. "Killing Me Softly: The Fetal Origins Hypothesis," Journal of Economic Perspectives, American Economic Association, vol. 25(3), pages 153-172, Summer.
    8. Prashant Bharadwaj & Petter Lundborg & Dan-Olof Rooth, 2018. "Birth Weight in the Long Run," Journal of Human Resources, University of Wisconsin Press, vol. 53(1), pages 189-231.

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    More about this item

    Keywords

    Food Consumption/Nutrition/Food Safety; Health Economics and Policy; International Development; Labor and Human Capital;
    All these keywords.

    JEL classification:

    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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