Parent-Child Information Frictions and Human Capital Investment: Evidence from a Field Experiment

65 Pages Posted: 24 Jun 2015

Date Written: June 23, 2015

Abstract

This paper uses a field experiment to answer how information frictions between parents and their children affect investments in education and how much reducing these frictions can improve student achievement. In Los Angeles, a random sample of parents was provided detailed information about their child’s academic progress. I frame the results in the context of a persuasion game between parents and their children. Parents have upwardly-biased beliefs about their child’s effort and the information treatment reduces this bias while increasing parental monitoring. More information allows parents to induce more effort from their children, which translates into significant gains in achievement. Relative to other interventions, additional information to parents potentially produces gains in achievement at a low cost.

Keywords: information frictions, experiment, parents

JEL Classification: I200, I210, I240

Suggested Citation

Bergman, Peter, Parent-Child Information Frictions and Human Capital Investment: Evidence from a Field Experiment (June 23, 2015). CESifo Working Paper Series No. 5391, Available at SSRN: https://ssrn.com/abstract=2622034 or http://dx.doi.org/10.2139/ssrn.2622034

Peter Bergman (Contact Author)

Columbia University ( email )

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