Parental investment and the joint evolution of children’s cognitive and non-cognitive skills: evidences in Vietnam

Abstract

Given the importance of skill set as a predictor of life outcomes, this study investigates the effect of parental investment on the development of cognitive and non-cognitive skills of 2,000 children, who were tracked from age 1 to age 12, using longitudinal data from Young Lives project in Vietnam. A model of skill formation is estimated using ordinary least squares and full information maximum likelihood as well as instrumental-variables to cope with missing values and potential endogeneity. Cognitive and non-cognitive skills are latent variables obtained from confirmatory factor analysis. There are three important findings in this study. Firstly, the results support that parental investment plays a crucial role in the development of both cognitive and non-cognitive skills in the first 12 years of child’s life. Secondly, there is compelling evidence for the presence of self-productivity of cognitive-skills as well as cross-productivity from cognitive skills to non-cognitive skills and vice versa. Thirdly, the time span until the age of 12 is found to be critical period for the development of cognitive skills while the age of 5 and the age of 8 are sensitive periods for cognitive skills relative to the age of 12. These findings support policy towards an education reform which help to promote not only cognitive skills but also non-cognitive skills; and policy towards an early childhood intervention programs, which aim at children living under disadvantage circumstances.