Effect of growing up poor on labor market outcomes: Evidence from Indonesia

Arbeitspapier

This paper investigates the long-term effect of child poverty on labor market outcomes using a 14-year span of data from the Indonesian Family Life Survey. Our instrumental variables estimation shows that a child who lived in a poor family when aged between eight and 17 years old suffers from an 87% earnings penalty relative to a child who did not grow up in a poor family. The direct effect remains large after we account for a large set of mediators. Depending on the set of mediators that we use, we estimate an earnings penalty of between 85% and 90%. Similarly, we do not find any evidence that receiving various government transfer programs mediates the effect of growing up poor on earnings as adults.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ADBI Working Paper Series ; No. 1002

Classification and Topics

• Classification: Wirtschaft ; Fertility; Family Planning; Child Care; Children; Youth ; Measurement and Analysis of Poverty ; Wage Level and Structure; Wage Differentials
• Subject: child poverty ; Indonesia ; instrumental variable ; labor market outcomes

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Rizky, Mayang ; Suryadarma, Daniel ; Suryahadi, Asep
• Event: Veröffentlichung
• (who): Asian Development Bank Institute (ADBI)
• (where): Tokyo
• (when): 2019

Further information

• Handle: http://hdl.handle.net/10419/222769
• Last update: 10.03.2025, 11:42 AM CET