Family Income and Child Outcomes in Canada

Martin Dooley, McMaster University
Jennifer Stewart, McMaster University

A positive relationship between income and child outcomes has been observed in data from numerous countries and surveys. In Canada, as well, children from poor families have worse behavioural, emotional and cognitive outcomes than do children from non-poor families. A key question for researchers and policy makers concerns the extent to which this empirical link represents a causal relationship. We use data from the Canadian National Longitudinal Survey of Children and Youth to implement a series of empirical strategies for estimating the size of the effect of income on child outcomes. Our results indicate that this effect may indeed be positive but that it is also likely to be smaller than the conventional estimates.