Causal Effects of Maternal Time-Investment on Children’s Cognitive Outcomes∗

Many social scientists hypothesize that the time mothers spend with their chil-dren is crucial for children’s cognitive development. Unlike most studies that focus on maternal employment effects on children, we estimate direct causal effects of time-diary measured maternal time using the Child Development Supplement (CDS)- Panel Study of Income Dynamics (PSID) data set. Considering endogeneity and using dif-ferent instruments, the effect of an increase of mother’s time associated to a rise in her opportunity cost of time is an order of magnitude larger than OLS estimates for cog-nitive tests. These effects are greater for white children living with college-educated mothers in two-parent households