Policymakers must be mindful that transfers to households to support young children will also be used to finance parents’ leisure and consumption

There is a growing consensus among academics and policymakers that interventions in early childhood to improve cognitive skills help to boost those made later during adolescence. In new research, Daniela Del Boca, Christopher Flinn, and Matthew Wiswall find evidence to support these interventions, but they argue that policymakers need to understand that households do not act solely to maximize their child’s development. They write that while government transfers of money and goods to households to support young children will be used to support them, they may also be used by parents to finance their own purchases of consumption goods and leisure.