Author:

Keywords:

locus of control, parental investment, human capital accumulation, early, Social Sciences, Economics, Business & Economics, MATERNAL EMPLOYMENT, COGNITIVE-DEVELOPMENT, CREDIT CONSTRAINTS, EXTERNAL-CONTROL, CONTROL SCALE, JOB SEARCH, PANEL-DATA, INVESTMENT, CHILDREN, EDUCATION, 14 Economics, 3801 Applied economics, 3802 Econometrics, 3803 Economic theory

Abstract:

This paper builds upon Cunha’s (2015) subjective rationality model in which parents have a subjective belief about the impact of their investment on their children’s early skill formation. We propose that this subjective belief is determined partly by locus of control (LOC), i.e., the extent to which individuals believe that their actions can influence future outcomes. Consistent with the theory, we show that maternal LOC measured at the 12th week of gestation strongly predicts maternal attitudes towards parenting style and actual time investments. We also utilize maternal LOC to improve the specification typically used to estimate skill production function parameters.