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Recent research (Wydick, Glewwe, and Rutledge, 2013) finds positive and statistically significant impacts on adult life outcomes from child sponsorship, including large impacts on schooling outcomes, the probability and quality of employment, occupational choice, and community leadership. This paper uses data from two countries to explore whether these impacts may be due not only to a relaxation of external constraints, but also to higher aspirations among sponsored children. We use survey data from Kenya and Indonesia, and psychological data from Indonesian children’s self-portraits, to test whether sponsorship significantly affects psychological variables in children that are likely to foster better economic outcomes in the future. We exploit an eligibility rule setting a maximum age for newly sponsored children. We use a child’s age at program rollout in his or her village as an instrument for sponsorship to establish a causal link between sponsorship and higher levels of self-esteem, as well as educational and occupational aspirations. We find a causal link between child sponsorship and large increases in educational and vocational aspirations among children in Kenya, and higher levels of happiness, self-efficacy, and hopefulness based on children’s self-portrait data from Indonesia.


Presented at the Young Lives Conference, Oxford, UK July 2013. This paper replaces three initial working papers related to the development of aspirations in internationally sponsored children. May 2014. (Prepared for the ASREC (Associated Study for Religion, Economics, and Culture) Conference, March 2014 and special issue on the Economics of Religion, Economic Journal.)

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