The program on children.

• Author: Currie, Janet
• Position: Program Report

U.S. public programs that are targeted to children and youth have grown rapidly in recent decades. This trend has generated a substantial volume of research devoted to program evaluation. At the same time, researchers have developed an expanded conception of human capital and how it develops over the life course. This has drawn attention to children's physical and mental health, as well as to factors such as environmental exposures and maternal stress that influence the development of both non-cognitive and cognitive skills. Researchers in the Program on Children have been active contributors both to the evaluation of programs for children and to our developing understanding of the roots of human capital formation. This review provides a partial summary of this work. The number of research studies in the last eight years unfortunately makes it impossible to discuss all of the relevant contributions.

Long Run Consequences of Conditions in Early Life

The original "fetal origins" hypothesis held that poor nutrition during the fetal period could have persistent effects on metabolism that could lead to adult disease. Economists in the children's group have broadened the scope of inquiry beyond a narrow focus on fetal nutrition to examine factors beyond prenatal nutrition, shocks in early childhood as well as the fetal period, and a much broader array of outcomes. Douglas Almond, Bhashkar Mazumder, and Reyn Van Ewijk show, for example, that nutritional restriction due to Ramadan fasting is associated with lower child test scores at age seven. (1) Joseph Ferrie and Karen Rolf show that socioeconomic status in a household when children are ages 0 to five is historically associated with longevity and health in old age [Figure 1]. (2) David Autor, David Figlio, Krzysztof Karbownik, Jeffrey Roth, and Melanie Wasserman link contemporary birth and schooling records in Florida to show that disadvantaged boys tend to have lower test scores, more disciplinary problems, and less likelihood of completing high school. (3) Anna Aizer, Shari Eli, Ferrie, and Adriana Lleras-Muney show that cash transfers to poor families at the early decades of the 20th century led to increases in the income and longevity of children in those households. (4) Similarly Fredrik Andersson, John Haltiwanger, Mark Kutzbach, Giordano Palloni, Henry Pollakowski, and Daniel Weinberg show that, once the endogeneity of public housing use is accounted for, childhood residence in supported housing, which has a large cash value, has positive effects on young adult earnings and reduces the probability of incarceration. (5) A possible caution: Gordon Dahl, Andreas Ravndal Kostoi, and Magne Mogstad show that family welfare participation can increase the probability that children grow up to participate themselves. (6)

Neighborhood conditions while young are another important determinant of longer-term outcomes. Jens Ludwig, Greg Duncan, Lisa Gennetian, Lawrence Katz, Ronald Kessler, Jeffrey Kling, and Lisa Sanbonmatsu summarize long-term effects of the Moving to Opportunity experiment, which enabled some poor families to move to less-poor neighborhoods, and find relatively little effect on children in those families. (7) However, Raj Chetty, Nathaniel Hendren, and Katz find that the younger children in those families did benefit from moving in terms of higher future incomes [Figure 2]. (8) Chetty, Hendren, Patrick Kline, and Emmanuel Saez argue that features of neighborhoods that promote social mobility include low residential segregation, less income inequality, better schools, more social capital, and more family stability. (9)

Many Program on Children researchers document longer-term effects of specific policy initiatives. Hilary Hoynes, Diane Schanzenbach, and Douglas Almond find positive effects of childhood participation in the Food Stamp Program on future adult health, as measured by reductions in rates of high blood pressure, obesity, and diabetes. (10) Gabriella Conti, James Heckman, and Rodrigo Pinto find improvements in the adult health of participants in two model preschool programs, (11) while Heckman, Pinto, and Peter Savelyev argue that much of this effect is operating through changes in personality traits. (12) On a cautionary note, Michael Baker, Jonathan Gruber, and Kevin Milligan find negative effects of a Quebec universal child care program on children's non-cognitive skills, underscoring the importance of program quality. (13)

Expansions of Medicaid and the Value of Medical Care

One of the most important policies that affected children born in the late 20th century was the expansion of public health insurance under the Medicaid program. State governments were first incentivized and then required to expand coverage to children in poor families, and many states expanded coverage to children with family incomes up to 200 percent of the federal poverty line. Because the expansions occurred at different times in different states and affected some age groups and not others, it is possible to identify the effect of insurance.

Currie, Sandra Decker, and Wanchuan Lin, (14) Bruce Meyer and Laura Wherry, (15) David Brown, Amanda Kowalski, and Ithai Lurie, (16) and Wherry, Sarah Miller, Robert Kaestner, and Meyer (17) all examine the long-term effect of these expansions on individuals who gained coverage as young children. They focus on different datasets and find positive effects on diverse young adult outcomes, including maternal reports of health, hospitalization for chronic conditions, and employment and earnings. Figure 3, from Wherry et al. (on the following page), shows the reduction in hospitalizations for chronic conditions among young adults who had Medicaid coverage from early childhood. Those born after September 1, 1983, were covered, whereas those born just before that date were never eligible. Currie and Hannes Schwandt argue that these expansions of access to care may explain some of the large reductions in mortality inequality among children over the past 20 years. (18)

These findings imply a large positive value for the medical care received at the margin, an inference borne out by Almond, Joseph Doyle, Kowalski, and Heidi Williams who estimate that the statistical cost of saving a very low birth weight's life was about $550,000 in 2006 dollars. (19) At the same time, Currie and Bentley MacLeod (20) and Erin Johnson and Marit Rehavi (21) study the incidence of C-sections, and conclude that many are probably unnecessary.

Stress and Mental Health

Researchers in the Program on Children have moved from focusing only on cognitive skills, to thinking about non-cognitive skills (such as social skills) and physical health, to explicitly studying mental health and its role in promoting positive future outcomes.

Using a sibling fixed effects design, Jason Fletcher examines ADHD, one of the most prevalent childhood mental health conditions and finds large negative impacts on employment, welfare use, and earnings. (22) While this finding would seem to argue that treatment of ADHD should have large positive effects, Currie, Mark Stabile, and Lauren Jones find that increases in drug treatment that accompanied an expansion of drug coverage in Quebec had little positive effect on educational outcomes or emotional functioning, suggesting that drug therapy alone may not be enough to improve outcomes. (23) Susan Busch, Ezra Golberstein, and Ellen Meara examine the use of antidepressants among adolescents and find that FDA "black box" warnings--the most stringent warnings used in prescription drug labeling--discouraged antidepressant use and led to increases in risky behaviors and small reductions in grade point averages. (24) Mark Anderson, Resul Cesur, and Erdal Tekin further argue that depression increases adolescent propensity to engage in property crime, though not violent crime or selling drugs. (25) Together these papers suggest that many children suffer from poor mental health and that more research into how it can be treated appropriately is needed.

Acute stress, both among mothers and among children, may be one root cause of poor mental health. Aizer, Laura Stroud, and Stephen Buka exploit unique data on maternal cortisol levels during pregnancy and find, using sibling comparisons, that children exposed to high levels of this "stress hormone" suffer negative effects on their cognitive functioning and motor development. (26) Moreover, mothers of lower socioeconomic status have higher cortisol levels, suggesting one mechanism for the intergenerational transmission of poverty. This is consistent with work by William Evans and Craig Garthwaite showing that Earned Income Tax Credit (EITC) payments are associated...