Maternal input choices and child cognitive development: testing for reverse causality

ABSTRACT

I assess whether the results of child achievement tests affect maternal employment and the child-care choices of mothers with prekindergarten children. To test this hypothesis, I use a quasi-structural approach to form approximations to the mother’s employment and child-care decision rules and jointly estimate them with the child cognitive development production function and wage equation. Using a sample of single mothers from the NLSY79, I find evidence that maternal employment and child-care decisions are sensitive to past achievement scores. In particular, a mother whose child has taken the Peabody Picture Vocabulary Test before entering kindergarten and whose child’s standardized test score is above a certain threshold intends to use childcare more and work more part-time hours immediately after observing the child’s performance on the achievement test.

KEYWORDS:

• Maternal input choices
• child cognitive development
• child-care
• simulated maximum likelihood
• simultaneous equations

JEL CLASSIFICATION:

• J22
• C35
• J13

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

¹ I use the same sample of single mothers used by Bernal and Keane (2010), who generously provided the full data for my empirical exercise.

² $R,\theta$ and $\tau$ include real AFDC/TANF maximum benefits calculated using the state (dollars), dummy for whether state s has time limit in place in period t, length of time limit in state s in period t, time in months elapsed since the implementation of time limit, dummy variable indicating whether a woman would have hit time limit, minimum potential remaining length of a woman’s time limit, dummy for whether state s has work requirement in place in period t, length (in months) of work requirement limit in state s in period t, time in months elapsed since the implementation of work requirement, age of youngest child below which the mother will be exempted from work requirement in state s at time t, number of work requirement exemptions in state s at time t, indicator for whether a woman could be subject to a work requirement, flat amount of earnings disregarded in calculating the benefit amount, benefit reduction rate, child support enforcement expenditure in state s at year t per single mother, EITC phase in rate constructed form both the federal and state level, CCDF expenditure per single mother in state s at time t, unemployment rate in state s in period t, hourly wage rate at the 20^th pctile, % employed in services. All these variables are adopted from Bernal and Keane (2010).

³ The off-diagonal and diagonal elements of the covariance-variance matrix are set to zero. This assumption breaks down the empirical model into four separate, independent regressions.