Abstract

Family poverty may affect family investments, which affect children's cognitive development. Based on a unique and nationally representative sample from the National Children’s Study of China (NCSC), this study aimed to explore the relationship between poverty and children’s cognitive abilities and the roles of different investments to the cognitive gaps. We had the following three findings. First, the cognitive abilities of children in poor families were significantly and negatively affected by their families’ poverty status. Second, poverty was significantly correlated with lower family education expenditures, lower expectations of parents for their children’s education, and more permissive parenting styles. Finally, the results of the Oaxaca-Blinder decomposition method showed that family educational expenditures, educational expectations, and permissive parenting styles accounted for substantial portions of the gaps in cognitive abilities.

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