Kids with rich grandparents do better in school
Having rich grandparents can clearly make a child’s life materially easier. But now it appears that wealth may also affect a child’s grades in school.
Social inequalities related to class, income, occupation and education can clearly influence a child’s performance in school.
But now a group of Swedish scientists has looked at the influence of grandparents' financial assets — money, stocks and property —on their grandchildren's outcomes in school.
As important as education
Their results show that a family's wealth has a great impact on a child’s grades.
The correlation between the grandparents' wealth and the children's performance in school is strong, even when compared to other socioeconomic factors. In fact, the researchers found, ‘old money’ is as important as the family's educational level.
The researchers used Swedish registers to study family wealth for the period from 1999-2007. These data are for the entire Swedish population. They were linked to the students' grades when they were in ninth grade.
The researchers looked at many other factors that are known to be important, including educational level, occupation, income, the father's intelligence and the social characteristics of the school the child attends.
More important than family’s income
Martin Hällsten is one of the main authors of the study. He said in a press release from Stockholm University that research on social inequality and mobility has been too focused on the family’s income.
It is important to take into account wealth, in the form of money, stocks or property, because this plays a role in the environment the child grows up in, he believes.
Norwegian research scientist Marianne Nordli Hansen agrees with Hällsten.
"One reason that it is more common to study the importance of the parents’ educational level than the family’s wealth is that it can be difficult to get information on the family’s wealth, and often there are major sources of error,” she said.
Same trend in Norway
Sweden and Norway are among the countries with the least social inequality in the entire industrialized world.
Nonetheless, Nordli Hansen believes that wealth is important, even in Norway.
"I do not think there is any reason to believe that Norway is different from Sweden in this regard,” she said. “New Norwegian research also shows that the family’s wealth has an effect on school results.”
No explanation, but theories
This type of study makes it impossible for researchers to say why there is a connection between family fortune and school results. But the Swedish researchers have some theories.
Firstly, it may be that having rich grandparents allows children and grandchildren to live in areas with good schools. Families with money can also buy computers and other things that can make it easier for children to do schoolwork.
It may also be that wealth protects parents from worries about unemployment, so that grandchildren are more likely to take greater risks in their choice of education, the researchers suggest. Children from wealthy families do not have to focus on accepting jobs that only offer them immediate employment and income.
A third factor may be that wealth in the family allows children to grow up in an environment that encourages investing in education. Most children today grow up with living grandparents, which means they potentially have a strong impact on their grandchildren.
Grandparents mean more than we think
Marianne Nordli Hansen believes that all these factors are important.
“We tend to underestimate the amount of purchasing power and transfer of wealth between generations for young people. More and more research, like this study, indicates that the grandparents' assets have the same importance as the parents’ wealth. And when these are accumulated over several generations, it can have an even stronger effect,” she says.
- Martin Hällsten and Fabian T. Pfeffer: Familjens förmögenhet och barnbarnens skolprestationer, Institutet för arbetsmarknads- och utbildningspolitisk utvärdering, Rapport 2017:3