Material Hardship and Children\u27s Social-Emotional Development: Testing Mitigating Effects of Child Development Accounts in a Randomized Experiment

Background Research has established a negative association between household material hardship and children\u27s mental health. This study examines whether Child Development Accounts (CDAs), an economic intervention that encourages families to accumulate assets for children\u27s long-term development, mitigate the association between material hardship and children\u27s social-emotional development. Methods Researchers conducted a randomized experiment of CDAs in Oklahoma, USA, with a probability sample (N = 7328) of all infants born in two 3-month periods in 2007. After agreeing to participate in the experiment, caregivers of 2704 infants completed a baseline survey and were assigned randomly to the treatment (n = 1358) or control group (n = 1346). The intervention exposed the treatment group to a CDA, which consisted of an Oklahoma 529 College Savings Plan account, financial incentives and financial information. Results Material hardship has a negative association with the social-emotional development of children around the age of 4 years. Estimates from regression analysis indicate that CDAs mitigate about 50% of the negative association between material hardship and children\u27s social-emotional development. Conclusions Although they do not provide direct support for consumption in households experiencing material hardship, CDAs may improve child development by influencing parenting practices and parents\u27 expectations for their children. We discuss the implications of using asset-building programmes to improve child development