Advertisement

Review of Economics of the Household

, Volume 7, Issue 1, pp 1–30 | Cite as

Decision-making by children

  • Shelly LundbergEmail author
  • Jennifer L. Romich
  • Kwok Ping Tsang
Article

Abstract

In this paper, we examine the determinants of decision-making power by children and young adolescents. Moving beyond previous economic models that treat children as goods consumed by adults, we develop a noncooperative model of parental control of child behavior and child resistance. Using child reports of decision-making and psychological and cognitive measures from the NLSY79 Child Supplement, we examine the determinants of shared and sole decision-making based on indices created from seven domains of child activity. We find that the determinants of sole decision-making by the child and shared decision-making with parents are quite distinct: sharing decisions appears to be a form of parental investment in child development rather than a simple stage in the transfer of authority. In addition, we find that indicators of child capabilities and preferences affect reports of decision-making authority in ways that suggest child demand for autonomy as well as parental discretion in determining these outcomes.

Keywords

Children Parents Investment Decisions 

Notes

Acknowledgements

We gratefully acknowledge comments from participants in the AEA session “Bargaining in Families” at the 2005 ASSA meetings in Philadelphia, PA and from seminar participants at Cornell University, UCLA, University of Washington, Washington University in St. Louis, the Institute for Social and Economic Research at the University of Essex, the University of Warwick, and the editor and referees of this journal. Financial support was provided by NICHD (R01 HD45635-2—“Child agency in resource allocation,” Romich, Principal Investigator) and by Lundberg’s Castor Professorship. Thanks to Xiang Gao, Lisa Keating, and Cori Mar for invaluable assistance.

References

  1. Becker, G. S. (1974). A theory of social interactions. The Journal of Political Economy, 82(6), 1063–1094. doi: 10.1086/260265.CrossRefGoogle Scholar
  2. Becker, G. S. (1991). Treatise on the family. Cambridge: Harvard University Press.Google Scholar
  3. Bergstrom, T. C. (1989). A fresh look at the rotten kid theorem—and other household mysteries. The Journal of Political Economy, 97(5), 1138–1159. doi: 10.1086/261646.CrossRefGoogle Scholar
  4. Browning, M., Bourguignon, F., Chiappori, P.-A., & Lechene, V. (1994). Income and outcomes: A structural model of intrahousehold allocation. The Journal of Political Economy, 102(6), 1067–1096. doi: 10.1086/261964.CrossRefGoogle Scholar
  5. Bruce, N., & Waldman, M. (1990). The rotten-kid theorem meets the Samaritan’s dilemma. The Quarterly Journal of Economics, 105(1), 155–165. doi: 10.2307/2937823.CrossRefGoogle Scholar
  6. Bulcroft, R. A., Carmody, D. C., & Bulcroft, K. A. (1996). Patterns of parental independence giving to adolescents: Variations by race, age, and gender of child. Journal of Marriage and the Family, 58(4), 866–883. doi: 10.2307/353976.CrossRefGoogle Scholar
  7. Bumpus, M. F., Crouter, A. C., & McHale, S. M. (2001). Parental autonomy granting during adolescence. Developmental Psychology, 37(2), 163–173. doi: 10.1037/0012-1649.37.2.163.CrossRefGoogle Scholar
  8. Burton, P., Phipps, S., & Curtis, L. (2002). All in the family: A simultaneous model of parenting style and child conduct. The American Economic Review, 92(2), 368–372. doi: 10.1257/000282802320191633.CrossRefGoogle Scholar
  9. Buss, A. H., & Plomin, R. (1975). A temperament theory of personality development. Wiley: New York.Google Scholar
  10. Center for Human Resource Research. (2000). 1998 Child and young adult data NLSY users guide. Columbus: Ohio State University.Google Scholar
  11. Chamberlain, G. (1980). Analysis of covariance with qualitative data. The Review of Economic Studies, 47, 225–238. doi: 10.2307/2297110.CrossRefGoogle Scholar
  12. Chase-Lansdale, P. L., Mott, F. L., Jeanne, B.-G., & Deborah, A. P. (1991). Children of the National Longitudinal Survey of Youth: A unique research opportunity. Developmental Psychology, 27(6), 918–931. doi: 10.1037/0012-1649.27.6.918.CrossRefGoogle Scholar
  13. Das, M., & van Soest, A. (1999). A panel data model for subjective information on household income growth. Journal of Economic Behavior & Organization, 40, 409–426. doi: 10.1016/S0167-2681(99)00062-1.CrossRefGoogle Scholar
  14. Dornbusch, M. S., Ritter, P. L., Liederman, P. H., Roberts, D. F., & Fraleigh, M. J. (1987). The relation of parenting style to adolescent school performance. Child Development, 58, 1244–1257.CrossRefGoogle Scholar
  15. Dornbusch, S. M., Carlsmith, J. M., Bushwall, S. J., Ritter, P. L., Leiderman, H., Hastorf, A. H., et al. (1985). Single parents, extended households, and the control of adolescents. Child Development, 56, 326–341. doi: 10.2307/1129723.CrossRefGoogle Scholar
  16. Ejrnaes, M., & Portner, C. C. (2004). Birth order and the intrahousehold allocation of time and education. The Review of Economics and Statistics, 86(4), 1008–1019. doi: 10.1162/0034653043125176.CrossRefGoogle Scholar
  17. Gilligan, C. (1982). In a different voice: Psychological theory and women’s development. Cambridge: Harvard University Press.Google Scholar
  18. Greene, W. (2008). Discrete choice modeling. In T. Mills & K. Patterson (Eds.), Handbook of econometrics: Vol. 2, applied econometrics. London: Palgrave.Google Scholar
  19. Hao, L., Hotz, V. J., & Jin, G. Z. (2008). Games parents and adolescents play: Risky behaviour, parental reputation and strategic transfers. The Economic Journal, 118(528), 515–555.CrossRefGoogle Scholar
  20. Harbaugh, W. T., Krause, K., & Berry, T. R. (2001). GARP for kids: On the development of rational choice behavior. The American Economic Review, 91(5), 1539–1545.Google Scholar
  21. Harbaugh, W. T., Krause, K., & Vesterlund, L. (2002). Risk attitudes of children and adults: Choices over small and large probability gains and losses. Experimental Economics, 5, 53–84. doi: 10.1023/A:1016316725855.CrossRefGoogle Scholar
  22. Keating, D. P. (1990). Adolescent thinking. In S. S. Feldman & G. R. Elliot (Eds.), At the threshold: The developing adolescent. Cambridge, MA: Harvard University.Google Scholar
  23. Kerr, M., & Stattin, H. (2000). What parents know, how they know it, and several forms of adolescent adjustment: Further support for a reinterpretation of monitoring. Developmental Psychology, 36(3), 366–380. doi: 10.1037/0012-1649.36.3.366.CrossRefGoogle Scholar
  24. Kooreman, P. (2004). Time, money, peers, and parents: Some data and theories on child behavior. Journal of Population Economics, 20, 9–33. doi: 10.1007/s00148-006-0121-8.CrossRefGoogle Scholar
  25. Maccoby, E. E. (2000). Parenting and its effects on children: On reading and misreading behavior genetics. Annual Review of Psychology, 51, 1–27. doi: 10.1146/annurev.psych.51.1.1.CrossRefGoogle Scholar
  26. Magnusson, D., & Stattin, H. (1998). Person-context interaction theories. In R. M. Lerner (Ed.), Handbook of child psychology: Theoretical models of human development. New York: Wiley.Google Scholar
  27. McElroy, M. B. (1985). The joint determination of household membership and market work: The case of young men. Journal of Labor Economics, 3(3), 293–316. doi: 10.1086/298057.CrossRefGoogle Scholar
  28. Olsen, R. (2001). “Explanation of sampling strategy and weights in the NLSY surveys”, Children of the NLSY79 Summer Workshop. Columbus, OH: Center for Human Resource Research.Google Scholar
  29. Pabilonia, S. W. (2001). Evidence on youth employment, earnings, and parental transfers in the National Longitudinal Survey of Youth 1997. The Journal of Human Resources, 36(4), 795–822. doi: 10.2307/3069642.CrossRefGoogle Scholar
  30. Pollak, R. A. (1988). Tied transfers and paternalistic preferences. The American Economic Review, 78(2), 240–244.Google Scholar
  31. Romich, J. L., Lundberg, S., & Tsang, K. P. (2008). Independence giving or autonomy taking? Childhood predictors of decision-sharing patterns between young adolescents and parents. Journal of Research on Adolescence (forthcoming).Google Scholar
  32. Sameroff, A. J. (1994). Developmental Systems and Family Functioning. In R. D. Parke & G. K. Sheppard (Eds.), Exploring family relationships with other social contexts. Hillsdale, NJ: Lawrence Erlbaum.Google Scholar
  33. Sameroff, A. J. (2000). Developmental systems and psychopathology. Development and Psychopathology, 12, 297–312. doi: 10.1017/S0954579400003035.CrossRefGoogle Scholar
  34. Steinberg, L., Mounts, N. S., Lamborn, S. D., & Dornbusch, S. M. (1991). Authoritative parenting and adolescent adjustment across varied ecological niches. Journal of Research on Adolescence, 1(1), 19–36.Google Scholar
  35. Yee, D. K., & Flanagan, C. (1985). Family environments and self-consciousness in early adolescence. The Journal of Early Adolescence, 5(1), 59–68. doi: 10.1177/0272431685051006.CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media, LLC 2008

Authors and Affiliations

  • Shelly Lundberg
    • 1
    Email author
  • Jennifer L. Romich
    • 2
  • Kwok Ping Tsang
    • 3
  1. 1.Department of EconomicsUniversity of WashingtonSeattleUSA
  2. 2.School of Social WorkUniversity of WashingtonSeattleUSA
  3. 3.Department of EconomicsVirginia TechBlacksburgUSA

Personalised recommendations