Working Paper: NBER ID: w25886
Authors: Yenchien Chen; Elliott Fan; Jintan Liu
Abstract: In this paper we evaluate the degree to which the adverse parental divorce effect on university education operates through deprivation of economic resources. Using one million siblings from Taiwan, we first find that parental divorce occurring at ages 13-18 led to a 10.6 percent decrease in the likelihood of university admission at age 18. We then use the same sample to estimate the effect of parental job loss occurring at the same ages, and use the job-loss effect as a benchmark to indicate the potential parental divorce effect due to family income loss. We find the job-loss effect very little. Combined, these results imply a minor role played by reduced income in driving the parental divorce effect on the child’s higher education outcome. Non-economic mechanisms, such as psychological and mental shocks, are more likely to dominate. Our further examinations show that boys and girls are equally susceptible, and younger teenagers are more vulnerable than the more mature ones, to parental divorce.
Keywords: Parental Divorce; Higher Education; Economic Resources; Psychological Wellbeing
JEL Codes: I20; J12; J64
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Non-economic factors (P42) | More influential than economic factors in explaining adverse effects of parental divorce on education outcomes (J12) |
| Parental divorce between ages 13 and 18 (J12) | Decrease in likelihood of university admission at age 18 (I24) |
| Parental job loss due to firm closure (J65) | No negative effect on university admission outcomes (I23) |
| Younger age at parental divorce (J12) | Decrease in likelihood of university admission (D29) |
| Parental divorce (J12) | Adverse effects on education outcomes (I24) |