- Our study uses data from the Great Smoky Mountains Study of Youth (GSMS). In this longitudinal study of child mental health in rural North Carolina, both American Indian and non-Indian children were sampled. Halfway through the data collection, a casino opened on the Eastern Cherokee reservation. A portion of the profits from this new business operation is distributed every six months on an equalized, per capita basis to all adult tribal members regardless of employment status, income or other household characteristics.
- We find that children who reside the longest in households with exogenously increased incomes tend to do better later in life on several outcome measures. The children in these households are more likely to have graduated from high school by age 19 as compared to the children from untreated households; by age 21 the treated children from the poorest households have an additional year of schooling.4 A rough estimate indicates that an average of $4000 additional household income for the poorest families results in an additional year of education for the child from a treated household.
Really interesting paper on a Cherokee tribe where families received up to $6,000 annually, which led to vast social and scholary improvements for their children. I think this can be related to the Basic Income debate, particulary because of this sentence:
- Our approach attempts to overcome the standard household income endogeneity problem in a direct manner - we observe households where incomes are increased exogenously and permanently through a governmental transfer program without regard to parental human capital, ability or other household characteristics.
To be fair, I haven't read it all, as it was linked in a Dutch article which explained the gist of it.
edit: the Dutch article also says that 'Randall Akee, a professor at the University of LA calculated conservatively that it actually saved money, as the decrease in criminality, healthcosts and highschool dropouts also has a pricetag.
Also tagging minimum_wage.