Child Ability, Parental Investments and Child Nutrition in Ecuador

This paper investigates the role of family composition and child cognitive ability in explaining how resource-constrained households make nutritional investment decisions in their children. When parents make investment decisions, they have private information about their children’s abilities and health that is typically not available to researchers. In this paper, I use a unique panel household dataset from Ecuador’s Bono de Desarrollo Humano that contains a measure of child cognitive ability and allows me to estimate its affect on resource allocation. Reverse causality of the effects of investments on ability is addressed through the use of panel data. Findings point to the existence of sibling rivalry due to resource constraints; children with more siblings, and children in poor households, are less likely to eat high-quality food. Children with higher abilities are less likely to share a nutritional supplement with another family member, suggesting that parents must decide how to invest their limited resources, and child ability informs that decision. Within households of more than one child, children with higher abilities are more likely to eat higher quality foods than their siblings, even after controlling for child body size.