Why do rich parents bother?

For several years, I have been relatively convinced that beyond a certain threshold, parenting does not matter. This belief came from two sources. The first was Judith Rich Harris’s book The Nurture Assumption in which she effectively argues that the children are socialised by other children, not their parents. The second was the concept that the variation attributable to genetic factors increases as you age (from memory I first read this in Matt Ridley’s The Agile Gene: How Nature Turns on Nurture – called Nature via Nurture in Australia). This implies that while environmental differences might affect the speed of development, the result is more robust to environmental factors.

I consider the idea that parenting does not matter to be relatively positive. As Harris argues in her book, instead of fretting about how you are shaping your children, you can relax, enjoy them and not worry that your actions could ruin their futures.

Adding to this picture, a new paper by Tucker-Drob and colleagues published in Psychological Sciences reports on a study on which 750 pairs of twins were tested at 10 months of age for mental ability. It was found that at 10 months, genes had a negligible influence on mental ability regardless of the socio-economic status of the family. However, the authors found that at the age of 2 years, genes have a measurable effect on variation in mental ability. This effect was most significant in the high socio-economic families, with genes accounting for around 50 per cent of the variation, while the effect of genes was negligible for those defined as low socio-economic status. I won’t go  further in the results here, but it is worth checking out Razib Khan’s deeper analysis of the paper.

This study supports the idea of larger genetic influence once a certain threshold is met and of increasing genetic influence as one ages. Razib and Jonah Lehrer noted that this study provides evidence that once the environmental variance is removed, the genetic variance remains. This comes from the diminishing marginal returns to investment in children. This makes sense, but the  question that hits me is why do rich parents bother with the effort they put into raising their children if, as Jonah suggests, rich parents don’t matter. You could write their actions off as being misguided as they chase increasingly low returns to their investment, but shouldn’t the revealed actions of these people tell us something.

So, here are a few suggestions to rationalise (or not) the investment, with varying degrees of plausibility. Some of these ideas are probably worth posts of their own down the track.

  1. The old chestnut – people are irrational. We could use an evolutionary argument that we evolved in a Malthusian era in which humans had to dedicate a high proportion of their income to increasing child quality. Now that wealth is abundant, people are inclined to invest a similar proportion of their income in education despite it having severely diminishing returns. If this argument holds, we would expect that in this era of abundance, those who invest less in quality and direct those resources to quantity will grow in proportion of the population (this reflects the result of the Galor and Moav model).
  2. The investment in children is a signal by the parents (conspicuous consumption), who still seek status.
  3. The investment is a signal for the child. Those years in a top school may not deliver more educational benefit, but it looks good on the CV. This does assume, however, that the person looking at the CV believes that the investment matters.
  4. Parents can influence the environmental factors that do matter. If you accept Harris’s argument that children socialise children, investment in attendance at a top private school might yield benefits (although I am not sure that a bunch of very rich class-mates is the what a child needs). However, you never know who your room mate at Yale might be.
  5. The investment matters in other dimensions. Although a child may be of a certain intelligence or level of sociability no matter what you do, they will only be a pro-golfer or concert pianist if they put in their 10,000 hours of practice. I am not convinced that the rate of return from such investment is enough to underpin the huge level of parental investment that occurs. While it might have worked for Tiger Woods, how many other golf fathers are putting their kids through their paces?

Personally, I lean largely towards 2 and 3, with a dose of 1 thrown in – if status obtained through signalling does not lead to an increase in the quantity of children, the proportion of the population who do not have such a trait and invest in quantity rather than quality will grow.

Are there any other explanations I have missed out?

7 thoughts on “Why do rich parents bother?

  1. also, re: #2, from a personal perspective people like to think they have control, and that the outcomes of their offspring reflect upon their character and investment.

  2. As a parent of a teenage and a tween who spent too much money on private school for my kid, I think reason 2 can be overstated. None of the parents that I know get a lot of status kids about having their children at any of the private schools. I think that most adults with older children (maybe not in Manhattan) are not as interested in playing status games with other adults through their children. The only status game I care about is at work which is not affected by what school my kids are at. I think reason 1 is important. I believe we all like to engage in magical thinking that this extra invest will have a huge effect. For me reason 4 is also very important. I do not want my children in environments that are dangerous or could cause to fall into trouble. As a side note, a friend of mine who is a professor has a daughter who goes to a very expensive private school in New England. Even though the education may not be that great this daughter has been very successful in dating the sons of very rich families.

    1. I like that twist on #4 – placing your children in an environment in which they are more likely to find a suitable mate. I suspect the average return to that strategy would be not enough in itself to justify it (particularly given the late age of marriage for many people), but the return would not be zero.

  3. Dear Jason,
    Do you have children?
    I think as any parent you wish to give your children the best of everything whether it is private schools or anything in life.
    The most important thing for me is that my children are happy.
    Having been sent to a private school by my parents, I would not do the same for my children if the school was not a good match with my child.

    1. Hi Simon, I don’t have children but I hope I remember what I have said above when I do. It is important to recognise what my motivations are. Then I will (hopefully) be able to enjoy my children for who they are, provide a rich, happy existence and not trick myself into believing that, for better or worse, they turned out the way they did all because of me.

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