The Effect of Parents’ Locus of Control Belief and Education on Investment in Their Children’s Health

This paper investigates how parents’ locus of control beliefs affect investment in their children’s health, depending on parental education. Parents with an external locus of control attribute outcomes to external factors outside of personal control whereas internal parents attribute outcomes to personal actions. Because locus of control influences the perceived probability of investment returns, external parents may underestimate returns and under-invest. I develop an economic model that illustrates how locus of control affects perceived probability of returns, which has opposing effects depending on the level of parental education. With cross-sectional data on parents’ beliefs and health utilization, I examine the link between parents’ locus of control beliefs and child health investments for parents with low and high levels of education. Using a probit analysis and controlling for income and insurance, I found a significant interaction effect between locus of control and education on the likelihood of children obtaining regular checkups. Educated parents with internal beliefs invest more in their children’s health than their counterparts. There are also trends that educated, internal parents are less likely to disinvest in health by smoking and binge drinking, but the effects are insignificant. Results confirm my theoretical model that locus of control affects health investments differently for low and highly educated parents, but not for health disinvestments. This research has important policy implication because changing parents’ beliefs and promoting education on the importance of health investment could be a cost-effective intervention to advocate for optimal health investment.