Towards a better understanding of the development of non-cognitive skills in children: The role of parents, local environment and exogenous shocks

• Applicant: Professorin Dr. Hannah Schildberg-Hörisch
• Subject Area: Economic Policy, Applied Economics
• Term: since 2017
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 392529304

Non-cognitive skills are key predictors of central life outcomes such as educational attainment, job performance or health outcomes. Despite their fundamental importance, we know surprisingly little about how non-cognitive skills form. This is the starting point of this research program. It aims at substantially advancing our understanding of the formation of non-cognitive skills in childhood and adolescence. In defining non-cognitive skills, our project adopts the interdisciplinary and multidimensional approach in the emerging field of personality psychology and economics. In this field, the definition of non-cognitive skills encompasses both economic preferences (time, risk and social preferences) and personality traits from psychology. We follow a multi-method approach in measuring non-cognitive skills that combines incentivized experiments, well-established scales and validated survey items, which will allow for reducing measurement error. By combining the collection of comprehensive panel data on non-cognitive skills of whole families with experimental designs, we can provide causal evidence on investments as possible drivers of skill formation on top of cutting-edge descriptive evidence on the formation of non-cognitive skills in childhood and adolescence. Using the model of skill formation as a common underlying theoretical framework, we will address several research questions specific to this renewal grant. First, we will extend the set of previously measured non-cognitive skills to incorporate measures of sophistication and naivité regarding own self-control and higher order risk preferences – both have recently gained increasing attention in behavioral economic theory, but are still understudied empirically. Based on novel measurement tools, we will investigate their and further skills’ malleability via a randomly assigned social and emotional learning program, their sensitive periods, their complementarity with other skills as well as self-productivity, typical trajectories in their development at the individual level and their transmission within the family. A second emphasis lies on the role of parental and public investments in shaping children’s skills. We will explore the role of cognitive scarcity for parental investments in their children. Focusing on public investments into children, we will exploit our detailed data on households’ geolocations to comprehensively analyze the importance of local environment beyond the family for children’s skill formation. Finally, we will use our multiple wave panel data to isolate whether the unanticipated, exogenous shock of the corona crisis leaves an imprint on children’s non-cognitive skills. The expected innovative insights will both promote basic research on the formation of non-cognitive skills at the intersection of economics and psychology and offer advice to parents, teachers and policy makers alike on how to foster the development of non-cognitive skills in children.

• DFG Programme: Research Grants
• International Connection: Australia
• Cooperation Partner: Professor Dr. Shyamal Chowdhury
• Co-Investigator: Professor Dr. Matthias Sutter