Moises Velasquez-Manoff: What Happens When the Poor Are Given a Stipend? →

This was a very interesting natural experiment. I will copy out some key passages below, but I think you will want to read the whole thing at the link above.

When the casino opened, Professor Costello had already been following 1,420 rural children in the area, a quarter of whom were Cherokee, for four years. That gave her a solid baseline measure. Roughly one-fifth of the rural non-Indians in her study lived in poverty, compared with more than half of the Cherokee. By 2001, when casino profits amounted to $6,000 per person yearly, the number of Cherokee living below the poverty line had declined by half.

She’d started her study with three cohorts, ages 9, 11 and 13. When she caught up with them as 19- and 21-year-olds living on their own, she found that those who were youngest when the supplements began had benefited most. They were roughly one-third less likely to develop substance abuse and psychiatric problems in adulthood, compared with the oldest group of Cherokee children and with neighboring rural whites of the same age.

The money, which amounted to between one-third and one-quarter of poor families’ income at one point, seemed to improve parenting quality. …

Many Cherokee worked “hard and long” during the summer, she told me, and then hunkered down when jobs disappeared in the winter. The supplements eased the strain of that feast-or-famine existence, she said. …

Mostly, though, the energy once spent fretting over such things was freed up. That “helps parents be better parents,” she said.

Maternal warmth can seemingly protect children from environmental stresses, however; at least in these communities, parenting quality seems to matter more to a child than material circumstances. On the other hand, few parents managed high levels of nurturing while also experiencing great strain. All of which highlights an emerging theme in this science: Early-life poverty may harm, in part, by warping and eroding the bonds between children and caregivers that are important for healthy development.