The preoccupied parent

Sergiu Burlacu, Anandi Mani, Piero Ronzani and Lucia Savadori

Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), 2023, vol. 105, issue C

Abstract: We examine the hypothesis that low parental investments in children may be a consequence of the adverse cognitive effects of poverty: financial worries preoccupy low-income parents with immediate concerns, shifting their attention away from stimulating parenting tasks. We test this hypothesis in an online experiment studying the purchase decisions of UK parents, including their responsiveness to financial subsidies for child development products. Both low and higher-income parents respond to a subsidy on such products, increasing their demands. However, when primed with financial worries under the same budget, low-income parents respond less to the subsidy, prioritizing instead the purchase of products addressing immediate household needs. This lower responsiveness to subsidies appears to be driven by worried parents further away from their last payday. Stronger safety nets and better alignment of financial subsidies to payday cycles may help achieve more investment and better child outcomes in poorer families.

Keywords: Scarcity; Psychology of poverty; Parenting; Early childhood; Household decisions; Subsidies (search for similar items in EconPapers)
JEL-codes: D13 D91 H31 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eee:soceco:v:105:y:2023:i:c:s2214804323000563

DOI: 10.1016/j.socec.2023.102030

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