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Early Health Shocks, Intrahousehold Resource Allocation, and Child Outcomes

Author

Listed:
  • Junjian Yi
  • James J. Heckman
  • Junsen Zhang
  • Gabriella Conti
Abstract
An open question in the literature is whether families compensate or reinforce the impact of child health shocks. Discussions usually focus on one dimension of child investment. This paper examines multiple dimensions using household survey data on Chinese child twins whose average age is 11. We find that, compared with a twin sibling who did not suffer from negative early health shocks at ages 0-3, the other twin sibling who did suffer negative health shocks received RMB 305 more in terms of health investments, but received RMB 182 less in terms of educational investments in the 12 months prior to the survey. In terms of financial transfers over all dimensions of investment, the family acts as a net equalizer in response to early health shocks for children. We estimate a human capital production function and establish that, for this sample, early health shocks negatively affect child human capital, including health, education, and socioemotional skills. Compensating investments in health as measured by BMI reduce the adverse effects of health shocks by 50%, but exacerbate the adverse impact of shocks on educational attainment by 30%.

Suggested Citation

  • Junjian Yi & James J. Heckman & Junsen Zhang & Gabriella Conti, 2014. "Early Health Shocks, Intrahousehold Resource Allocation, and Child Outcomes," NBER Working Papers 20757, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:20757
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    References listed on IDEAS

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    1. Sandra E. Black & Erik Grönqvist & Björn Öckert, 2018. "Born to Lead? The Effect of Birth Order on Noncognitive Abilities," The Review of Economics and Statistics, MIT Press, vol. 100(2), pages 274-286, May.
    2. Sneha Elango & Jorge Luis García & James J. Heckman & Andrés Hojman, 2015. "Early Childhood Education," NBER Chapters, in: Economics of Means-Tested Transfer Programs in the United States, Volume 2, pages 235-297, National Bureau of Economic Research, Inc.
    3. Muhammad Nasir, 2016. "Violence and Child Health Outcomes: Evidence from Mexican Drug War," HiCN Working Papers 208, Households in Conflict Network.
    4. Nicholas W. Papageorge & Gwyn C. Pauley & Mardge Cohen & Tracey E. Wilson & Barton H. Hamilton & Robert A. Pollak, 2021. "Health, Human Capital, and Domestic Violence," Journal of Human Resources, University of Wisconsin Press, vol. 56(4), pages 997-1030.
    5. Jin, L. & Ziebarth, N.R., 2015. "Sleep and Human Capital: Evidence from Daylight Saving Time," Health, Econometrics and Data Group (HEDG) Working Papers 15/27, HEDG, c/o Department of Economics, University of York.
    6. Schwandt, Hannes, 2017. "The Lasting Legacy of Seasonal Influenza: In-Utero Exposure and Labor Market Outcomes," IZA Discussion Papers 10589, Institute of Labor Economics (IZA).
    7. Dora L. Costa, 2015. "Health and the Economy in the United States from 1750 to the Present," Journal of Economic Literature, American Economic Association, vol. 53(3), pages 503-570, September.
    8. Elliott Fan & Jin-Tan Liu & Yen-Chien Chen, 2014. "Is the 'Quarter of Birth' Endogenous? Evidence From One Million Siblings in Taiwan," NBER Working Papers 20444, National Bureau of Economic Research, Inc.

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    More about this item

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth

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