Early Life Endowments and the Production of Skill and Health Capital
Disparities in health across socioeconomic status (SES) groups, often termed the "health gradient", are substantial. A large part of the health gradient is due to early childhood endowments and investments. In a series of papers, David Barker and co-authors demonstrated the importance of fetal growth on later-life outcomes (e.g., Barker, 1995). More recently, James Heckman and colleagues have emphasized the role of childhood cognitive and, particularly, non-cognitive abilities in determining both education and health outcomes in later life (e.g., Cunha and Heckman, 2007; Conti, Heckman, and Urzua 2010). They discuss the complexity of early childhood skill formation, pointing out, amongst others, that abilities matter, that abilities are multiple in nature, that socio-emotional or non-cognitive skills foster the development of cognitive skills, that there are sensitive and critical periods in the development of child abilities, that ability gaps form at early ages and are difficult to remediate at late but not early ages, and that early investments in children need to be followed up with later investments or effects are lessened. The work of Cunha and Heckman (2007) focuses on how preferences and childhood endowments are determined by parental investments in their children, and their focus is less on late-life investments and outcomes. In this session we present a theory paper and two empirical papers assessing the effects of early-life parental and later-life own investment in health and human capital on health and economic outcomes.