Parental involvement and Children's human capital: A tax-subsidy experiment

Parental time with children has a significant influence on early childhood development, future accumulation of a wide array of cognitive and non-cognitive skills and the ultimate success of the child. The model presented in this article features endogenous fertility and labour supply while distingui...

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Published inEconomic modelling Vol. 85; pp. 16 - 29
Main Authors Gahramanov, Emin, Hasanov, Rashad, Tang, Xueli
Format Journal Article
LanguageEnglish
Published Elsevier B.V 01.02.2020
Subjects
Cognitive skills
Fertility
Human capital
Labor supply
Non-cognitive skills
Optimal control
Parental investment
Non-cognitive skills
Labor supply
D10
Human capital
C54
H52
H31
D15
J22
J13
J24
Fertility
Optimal control
Cognitive skills
Parental investment
C60
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Abstract Parental time with children has a significant influence on early childhood development, future accumulation of a wide array of cognitive and non-cognitive skills and the ultimate success of the child. The model presented in this article features endogenous fertility and labour supply while distinguishing between various types of parental time spent with children. We conduct a quantitative analysis to investigate the importance of the role of family for children's skill formation. In the model, parents are subsidized for spending publicly verifiable productive time with their children. Such intervention can significantly enhance the human capital of children, yet it affects the overall labour supply of the primary caretaker in an ambiguous way. •We conduct a tax-subsidy experiment in which parents are subsidized for spending productive time with their children.•This revenue-neutral reform can significantly improve children's human capital.•The subsidy affects other forms of parental time and the primary caretaker's labour supply.
AbstractList Parental time with children has a significant influence on early childhood development, future accumulation of a wide array of cognitive and non-cognitive skills and the ultimate success of the child. The model presented in this article features endogenous fertility and labour supply while distinguishing between various types of parental time spent with children. We conduct a quantitative analysis to investigate the importance of the role of family for children's skill formation. In the model, parents are subsidized for spending publicly verifiable productive time with their children. Such intervention can significantly enhance the human capital of children, yet it affects the overall labour supply of the primary caretaker in an ambiguous way. •We conduct a tax-subsidy experiment in which parents are subsidized for spending productive time with their children.•This revenue-neutral reform can significantly improve children's human capital.•The subsidy affects other forms of parental time and the primary caretaker's labour supply.
Author Tang, Xueli
Hasanov, Rashad
Gahramanov, Emin
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  surname: Gahramanov
  fullname: Gahramanov, Emin
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  organization: American University of Sharjah, United Arab Emirates
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  organization: ADA University, Azerbaijan
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  givenname: Xueli
  surname: Tang
  fullname: Tang, Xueli
  organization: Deakin University, Australia
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Keywords Non-cognitive skills
Labor supply
D10
Human capital
C54
H52
H31
D15
J22
J13
J24
Fertility
Optimal control
Cognitive skills
Parental investment
C60
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Snippet Parental time with children has a significant influence on early childhood development, future accumulation of a wide array of cognitive and non-cognitive...
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SubjectTerms Cognitive skills
Fertility
Human capital
Labor supply
Non-cognitive skills
Optimal control
Parental investment
Title Parental involvement and Children's human capital: A tax-subsidy experiment
URI https://dx.doi.org/10.1016/j.econmod.2019.05.002
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