The Causal Effects of Income Supplements on Child Health and Development: A Systematic Review

Children who grow up in poverty have poorer cognitive, academic, behavioral, and health development compared to their peers. Would policies that raise poor families’ income be useful in preventing disparities in child health and development? While the association between childhood poverty and poorer child development is well documented, it is less clear that the association is causal. We conducted a systematic review of the evidence on the causal effects of income supplements on child development, including their cognitive, academic, behavioral, and health outcomes. We searched PsycINFO, ERIC, EconLit, and PubMED, and identified 1447 unique publications. Of those, 85 met inclusion criteria. The studies reviewed used a variety of approaches to test the causal relationships between income supplements and child development, including experimental designs and natural experiments, with instrumental variable, regression discontinuity, difference-in-differences, and family fixed effects estimates. They leveraged data from representative samples of the US and other countries (e.g., Children of the National Longitudinal Survey of Youth; Survey of Income and Program Participation), as well as more specific samples exposed to an experiment or natural experiment condition (e.g., Great Smoky Mountain Study; Gary Income Maintenance Experiment). We examined how the effects vary with the characteristics of income supplement strategies, such as the contingency of benefits on parental work, and the amount and duration of the supplement. This presentation will address key questions for evidence-based policymaking. It will help answer questions about the potential impact on child health and development of enhancing existing US income policies (e.g., the Earned Income Tax Credit, the minimum wage, or Temporary Assistance for Needy Families), or introducing policies that currently exist outside of the US (e.g., child benefits).