Advertisement

Demography

, Volume 52, Issue 3, pp 835–860 | Cite as

Parental Spending on School-Age Children: Structural Stratification and Parental Expectation

  • Lingxin HaoEmail author
  • Wei-Jun Jean Yeung
Article

Abstract

As consumption expenditures are increasingly recognized as direct measures of children’s material well-being, they provide new insights into the process of intergenerational transfers from parents to children. Little is known, however, about how parents allocate financial resources to individual children. To fill this gap, we develop a conceptual framework based on stratification theory, human capital theory, and the child-development perspective; exploit unique child-level expenditure data from Child Supplements of the PSID; and employ quantile regression to model the distribution of parental spending on children. Overall, we find strong evidence supporting our hypotheses regarding the effects of socioeconomic status (SES), race, and parental expectation. Our nuanced estimates suggest that (1) parental education, occupation, and family income have differential effects on parental spending, with education being the most influential determinant; (2) net of SES, race continues to be a significant predictor of parental spending on children; and (3) parental expectation plays a crucial role in determining whether parents place a premium on child development in spending and how parents prioritize different categories of spending.

Keywords

Parental spending on children SES Race Parental expectation Quantile regression 

References

  1. Anastasi, A. (1956). Intelligence and family size. Psychological Reports, 53, 187–203.Google Scholar
  2. Becker, G. S., & Tomes, N. (1986). Human capital and the rise and fall of families. Journal of Labor Economics, 4, S1–S39.CrossRefGoogle Scholar
  3. Blake, J. (1989). Family size and achievement. Berkeley and Los Angeles: University of California Press.Google Scholar
  4. Blank, R. M., & Schoeni, R. F. (2003). Changes in the distribution of children’s family income over the 1990’s. American Economic Review, 93, 304–308.CrossRefGoogle Scholar
  5. Bradley, R. H., Corwyn, R. F., McAdoo, H. P., & Coll, C. G. (2001). The home environments of children in the United States part I: Variations by age, ethnicity, and poverty status. Child Development, 52, 708–710.Google Scholar
  6. Brooks-Gunn, J., & Markman, L. B. (2005). The contribution of parenting to ethnic and racial gaps in school readiness. Future of Children, 15(1), 139–168.CrossRefGoogle Scholar
  7. Charles, K. K, Danziger, S., Li, G., & Schoeni, R. (2007a). Studying consumption with the Panel Study of Income Dynamics: Comparison with the Consumer Expenditure Survey and an application to the intergenerational transmission of well-being (Working paper). Retrieved from http://works.bepress.com/geng_li/6
  8. Charles, K. K., Hurst, E., & Roussanov, N. (2007b). Conspicuous consumption and race. The Quarterly Journal of Economics, 124, 425–467.CrossRefGoogle Scholar
  9. Citro, C. F., & Michael, R. T. (Eds.). (1995). Measuring poverty: A new approach. Washington, DC: National Academies Press.Google Scholar
  10. Conley, D. (1999). Being black, living in the red: Race, wealth, and social policy in America. Berkeley: University of California Press.Google Scholar
  11. Conley, D., & Bennett, N. G. (2000). Is biology destiny? Birth weight and life chances. American Sociology Review, 65, 458–467.CrossRefGoogle Scholar
  12. Cosby, B., & Poussaint, A. F. (2007). Come on, people: On the path from victims to victors. Nashville, TN: Thomas Nelson.Google Scholar
  13. Dardis, R., Derrick, F., & Lehfeld, A. (1981). Clothing demand in the United States: A cross-sectional analysis. Home Economics Research Journal, 10, 212–222.CrossRefGoogle Scholar
  14. Davis-Kean, P. E. (2005). The influence of parent education and family income on child achievement: The indirect role of parental expectations and the home environment. Journal of Family Psychology, 19, 294–304.CrossRefGoogle Scholar
  15. Duncan, O. D. (1961). A socioeconomic index for all occupations. In J. Reiss Jr. (Ed.), Occupations and social status (pp. 109–138). New York, NY: Free Press of Glencoe.Google Scholar
  16. Eccles, J. S. (2005). Influences of parents’ education on their children’s educational attainments: The role of parent and child perceptions. London Review of Education, 3, 191–204.CrossRefGoogle Scholar
  17. Edin, K., & Lein, L. (1997). Making ends meet: How single mothers survive welfare and low wage work. New York, NY: Russell Sage Foundation.Google Scholar
  18. Eggebeen, D. J., & Lichter, D. T. (1991). Race, family structure, and changing poverty among American children. American Sociological Review, 56, 801–817.CrossRefGoogle Scholar
  19. Fan, J. X., & Lewis, J. K. (1999). Budget allocation patterns of African Americans. Journal of Consumer Affairs, 33, 134–164.Google Scholar
  20. Hagan, J., & Peterson, R. D. (Eds.). (1995). Crime and inequality. Stanford, CA: Stanford University Press.Google Scholar
  21. Hao, L. X. (1996). Family structure, private transfers, and the economic well-being of families with children. Social Forces, 75, 269–292.CrossRefGoogle Scholar
  22. Hao, L. X., & Naiman, D. Q. (2007). Quantile regression. Thousand Oaks, CA: Sage Publications.Google Scholar
  23. Haveman, R., & Wolfe, B. (1995). The determinants of children’s attainment: A review of methods and findings. Journal of Economic Literature, 33, 1829–1878.Google Scholar
  24. Koenker, R. (2005). Quantile regression. Cambridge, MA: Cambridge University Press.CrossRefGoogle Scholar
  25. Koenker, R., & Bassett, G., Jr. (1978). Regression quantiles. Econometrica, 46, 33–50.CrossRefGoogle Scholar
  26. Koenker, R., & Machado, J. A. F. (1999). Goodness of fit and related inference processes for quantile regression. Journal of the American Statistical Association, 94, 1296–1310.CrossRefGoogle Scholar
  27. Kohn, M. L. (1969). Class and conformity: A study in values. Oxford, UK: Dorsey.Google Scholar
  28. Kornrich, S., & Furstenberg, F. (2013). Investing in children: Changes in parental spending on children, 1972–2007. Demography, 50, 1–23.CrossRefGoogle Scholar
  29. Land, K. C., McCall, P. L., & Cohen, L. E. (1990). Structural covariates of homicide rates: Are there any invariances across time and social space? American Journal of Sociology, 95, 922–963.CrossRefGoogle Scholar
  30. Lareau, A. (2003). Unequal childhoods: Class, race, and family life. Berkeley: University of California Press.Google Scholar
  31. Li, G., Schoeni, R. F., Danziger, S., & Charles, K. K. (2010). New expenditure data in the PSID: Comparisons with the CE. Monthly Labor Review, February, 20–39.Google Scholar
  32. Lundberg, S., & Rose, E. (2004). Investments in sons and daughters: Evidence from the Consumer Expenditure Survey. In A. Kalil & T. DeLeire (Eds.), Family investments in children: Resources and behaviors that promote success (pp. 163–180). Mahwah, NJ: Erlbaum.Google Scholar
  33. Lupton, J. P., & Smith, J. P. (2003). Marriage, assets, and savings. In S. A. Grossbard-Shechtman (Ed.), Marriage and the economy: Theory and evidence from advanced industrial societies (pp. 129–152). Cambridge, UK: Cambridge University Press.CrossRefGoogle Scholar
  34. Magnuson, K., & Waldfogel, J. (2008). Steady gains and stalled progress: Inequality and the black-white test score gap. New York, NY: Russell Sage.Google Scholar
  35. McNeal, R. B. (1995). Extracurricular activities and high school dropouts. Sociology of Education, 68, 62–81.CrossRefGoogle Scholar
  36. Meyer, B. D., & Sullivan, J. X. (2008). Changes in the consumption, income, and well-being of single mother headed families. American Economic Review, 98, 2221–2241.CrossRefGoogle Scholar
  37. Omori, M. (2010). Household expenditures on children, 2007–08. Monthly Labor Review, September, 3–16.Google Scholar
  38. Reardon, S. F. (2011). The widening academic achievement gap between the rich and the poor. In G. Duncan & R. Murnane (Eds.), Whither opportunity? (pp. 92–115). New York, NY: Russell Sage.Google Scholar
  39. Schor, J. (2004). Born to buy: The commercialized child and the new consumer culture. New York, NY: Scribner.Google Scholar
  40. Smith, J. R., Brooks-Gunn, J., & Klebanov, P. K. (1997). Consequences of living in poverty for young children’s cognitive and verbal ability and early school achievement. In G. J. Duncan & J. Brooks-Gunn (Eds.), Consequences of growing up poor (pp. 132–189). New York, NY: Russell Sage Foundation.Google Scholar
  41. Steelman, L. C., & Powell, B. (1991). Sponsoring the next generation: Parental willingness to pay for higher education. American Journal of Sociology, 96, 1505–1529.CrossRefGoogle Scholar
  42. Weber, M. (1946). From Max Weber: Essays in sociology (H. Gerth & C. Wright Mills, Transl., Eds.). New York, NY: Oxford University Press.Google Scholar
  43. Western, B., Percheski, C., & Bloome, D. (2008). Inequality among American families with children, 1975 to 2005. American Sociological Review, 73, 903–920.CrossRefGoogle Scholar
  44. Yeung, W. J., & Conley, D. (2008). Black-white achievement gap and family wealth. Child Development, 79, 303–324.CrossRefGoogle Scholar
  45. Yeung, W. J., & Pfeiffer, K. M. (2009). The black-white test score gap and early home environment. Social Science Research, 38, 412–437.CrossRefGoogle Scholar

Copyright information

© Population Association of America 2015

Authors and Affiliations

  1. 1.Department of SociologyJohns Hopkins UniversityBaltimoreUSA
  2. 2.Department of Sociology and Asia Research InstituteNational University of SingaporeSingaporeSingapore

Personalised recommendations