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Should Children Do More Enrichment Activities? Leveraging Bunching to Correct for Endogeneity

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Abstract
We study the effects of enrichment activities such as reading, homework, and extracurricular lessons on children's cognitive and non-cognitive skills. We take into consideration that children forgo alternative activities, such as play and socializing, in order to spend time on enrichment. Our study controls for selection on unobservables using a novel approach which leverages the fact that many children spend zero hours per week on enrichment activities. At zero enrichment, confounders vary but enrichment does not, which gives us direct information about the effect of confounders on skills. Using time diary data available in the Panel Study of Income Dynamics (PSID), we find that the net effect of enrichment is zero for cognitive skills and negative for non-cognitive skills, which suggests that enrichment may be crowding out more productive activities on the margin. The negative effects on non-cognitive skills are concentrated in higher-income students in high school, consistent with elevated academic competition related to college admissions.

Suggested Citation

  • Carolina Caetano & Gregorio Caetano & Eric R. Nielsen, 2020. "Should Children Do More Enrichment Activities? Leveraging Bunching to Correct for Endogeneity," Finance and Economics Discussion Series 2020-036, Board of Governors of the Federal Reserve System (U.S.).
    • Handle: RePEc:fip:fedgfe:2020-36
    DOI: 10.17016/FEDS.2020.036
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    References listed on IDEAS

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    Cited by:

    1. Bertanha, Marinho & McCallum, Andrew H. & Seegert, Nathan, 2023. "Better bunching, nicer notching," Journal of Econometrics, Elsevier, vol. 237(2).
    2. Marinho Bertanha & Andrew H. McCallum & Alexis Payne & Nathan Seegert, 2022. "Bunching estimation of elasticities using Stata," Stata Journal, StataCorp LP, vol. 22(3), pages 597-624, September.
    3. Carolina Caetano & Gregorio Caetano & Hao Fe & Eric R. Nielsen, 2021. "A Dummy Test of Identification in Models with Bunching," Finance and Economics Discussion Series 2021-068, Board of Governors of the Federal Reserve System (U.S.).
    4. Jürges, Hendrik & Khanam, Rasheda, 2021. "Adolescents’ time allocation and skill production," Economics of Education Review, Elsevier, vol. 85(C).

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    More about this item

    Keywords

    Time use; Enrichment; Bunching; Cognitive skills; Homework; College; Skill development; Non-cognitive skills; Human capital;
    All these keywords.

    JEL classification:

    • C24 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Truncated and Censored Models; Switching Regression Models; Threshold Regression Models
    • I20 - Health, Education, and Welfare - - Education - - - General
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General

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