Family resources and children’s skills: development of a skills attainment model

Abstract

The association between parental SES and children’s educational outcomes is one of the key topics in stratification research. Although most differences between social groups are explained by initial differences in performance, the influence of family resources associated with children’s basic skills is still poorly understood. We therefore developed a skills attainment model, focusing on the relative contribution of three family resources: parents’ own basic skills at age 12, other parental skills developed in education and financial resources in the household. In addition, we examine potential heterogeneity across social groups. We develop a unique dataset, the Intergenerational Transmission of Skills dataset, covering 25,000 Dutch parents and 41,000 children. It includes high-quality test scores in math and language, similarly measured among parents and children, and detailed register information on educational attainment and income. Using structural equation modeling, we find that about one-fifth of children’s basic skills is explained by the three parental resources. Of this explained variance, 69 percent is related to parent’s basic skills, 21 percent to other parental skills developed in education and 10 percent to household income. We find no substantial differences in the transmission across sex, between low- and high-income families and between low- and high-educated parents.