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Childhood Shocks Across Ages and Human Capital Formation

Author

Listed:
  • Pedro Carneiro

    (University College London)

  • Kjell Salvanes

    (Norges Handelshøyskole)

  • Barton Willage

    (University of Colorado--Denver)

  • Alexander Willén

    (Norwegian School of Economics, CESifo, and UCLS)

Abstract

We provide estimates of the causal impact of shocks to home environments during childhood on the human capital formation of children and their adult earnings, and document how these impacts differ depending on the age of the child when the shock occurs. We do so by comparing the outcomes of children whose parents experienced an involuntary job loss at different points in time. The rich data we have access to enable us to examine a broad range of short- and long-term educational outcomes related to performance, attainment, and behavior. In addition, for a subsample of our cohorts we can explore earnings effects at age 30. Consistent with other studies, we confirm that early childhood represents a crucial time for acquiring skills and abilities, but also establish that changes in the home environment for children in early adolescence matter as much, and sometimes more. We rationalize these results by noting that sensitive periods for different skills occur at different stages of childhood. Furthermore, it is during early adolescence that children face key junctures in their educational choices.

Suggested Citation

  • Pedro Carneiro & Kjell Salvanes & Barton Willage & Alexander Willén, 2023. "Childhood Shocks Across Ages and Human Capital Formation," Working Papers 2023-018, Human Capital and Economic Opportunity Working Group.
    • Handle: RePEc:hka:wpaper:2023-018
    Note: MIP
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    File URL: http://humcap.uchicago.edu/RePEc/hka/wpaper/Carniero_Salvanes_Willage_etal_2023_childhood-shocks-ages-hum-cap-formation.pdf
    File Function: First version, July 26, 2023
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    References listed on IDEAS

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    Cited by:

    1. Pedro Carneiro & Kjell Salvanes & Emma Tominey, 2024. "Insurance against Income Shocks, Parental Investments, and Child Development," CEPEO Working Paper Series 24-04, UCL Centre for Education Policy and Equalising Opportunities, revised Jun 2024.

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    More about this item

    Keywords

    early childhood development; intergenerational links; human capital;
    All these keywords.

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • D10 - Microeconomics - - Household Behavior - - - General

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