Cash for Poor Families Isn't Enough to Boost Academic Outcomes

A recent rigorous study found, to the researchers’ apparent surprise and disappointment, that providing parents of newborns with cash for four years didn’t result in measurable benefits. The researchers recruited a thousand low-income mothers in various US cities for the study. One group got $333 a month, while the control group got only $20 a month.

The researchers assessed all the children on seven measures: vocabulary, executive function, pre-literacy skills, spatial perception, social and emotional behavior, and chronic health conditions. They found no significant differences between the groups on any of the measures.

The results weren’t widely reported, although the New York Times ran a story about them on the front page of its print edition. And there are reasons to view the data with caution.

According to the Times, some lead researchers on the study suspect the pandemic skewed the outcomes. Not only did it disrupt people’s lives, the federal government also provided pandemic-related aid to all poor families, including the control group. That had the effect of making the two groups more similar in terms of income than they otherwise would have been.

In any event, some point out that $333 a month might not have been enough to make a difference to the outcomes they were measuring. In addition, they say, the benefits of the cash payments may not become apparent until after the children start school.

The money might also have yielded benefits that didn’t show up in the data. The mothers who got the $333 felt it made a difference in their lives, according to the Times story. They spent it on things like gifts for their children and family outings to restaurants or the zoo.

Confusing Correlation with Causation

But fundamentally, the assumption that raising family income will automatically translate into bigger vocabularies or better pre-literacy skills seems to confuse correlation with causation. Yes, children from more affluent families generally have bigger vocabularies and better literacy skills than their low-income peers, but that’s not just because they have more money. More likely, it’s because their parents have higher levels of education, enabling them to surround their children from birth in an environment that expands their vocabularies and their knowledge of the world.

The way to test the relative effects of money and parental education would be to take a group of poor parents that includes some with high levels of education and see