Eliciting Maternal Expectations about the Technology of Cognitive Skill Formation
In this paper, we formulate a model of early childhood development in which mothers have subjective expectations about the technology of skill formation. The model is useful for understanding how maternal knowledge about child development affects the maternal choices of investments in the human capital of children. Unfortunately, the model is not identified from data that are usually available to econometricians. To solve this problem, we conduct a study where mothers were interviewed to elicit maternal expectations about the technology of skill formation. We interviewed a sample of socioeconomically disadvantaged African‐American women. We find that the median subjective expectation about the elasticity of child development with respect to investments is between 4% and 19%. In comparison, when we estimate the technology of skill formation from the CNLSY/79 data, we find that the elasticity is between 18% and 26%. We use the model and our unique data to answer a simple but important question: What would happen to investments and child development if we implemented a policy that moved expectations from the median to the objective estimates that we obtain from the CNLSY/79 data? According to our estimates, maternal investments would go up by between 4% and 24% and the stocks of cognitive skills at age 24 months would subsequently increase between 1% and 5%. Needless to say, the impacts of such a policy would be even higher for mothers whose expectations were below the median.
We thank Dalton Banks, Michelle Gifford, Debbie Jaffe, Snejana Nihtianova, Ben Sapp, and Cheryl Tocci for excellent research assistance. We are grateful to Orazio Attanasio, Jere Behrman, Pietro Biroli, Hanming Fang, Limor Golan, Katja Kaufmann, James Heckman, Pedro Mira, Krishna Pendakur, Matt Wiswall, and Ken Wolpin for their comments in different stages of this research. We also thank participants at the Early Childhood Development and Human Capital Accumulation conference at University College London, the Institute for Research on Poverty's Summer Workshop at the University of Wisconsin ‐ Madison, the Children's Human Capital Development workshop at Aarhus University in Denmark, the CES‐ifo conference on the Economics of Education, the Conference on the Economics of the Family at the University of Chicago and seminar participants at Columbia University, the University of Pennsylvania, UCLA, Stanford University, UC Berkeley, Insper São Paulo, CHPPP at the Harris School, the International Food and Policy Research Institute, Duke University, the EPGE/FGV Rio de Janeiro, the Pontifical Catholic University in Rio de Janeiro, UCI, and the Federal Reserve Bank in New York. This research was supported by grant INO12‐00013 from the Institute for New Economic Thinking. All remaining errors are ours. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.