Social Policy Research Paper Number 47: Low Income and Poverty Dynamics - Implications for Child Outcomes

This report uses data from the first five waves of the Longitudinal Study of Australian Children (LSAC) to examine the association between childhood poverty and a range of children’s developmental outcomes.  

The authors found there is a strong negative association between poverty and children’s developmental outcomes. The negative effects associated with low income and poverty carry a significant cost for individuals and families, as well as the broader community. There are also clear costs associated with children’s development and wellbeing—the impacts of which are likely to be amplified later in life for the children who experienced poverty and also the wider society.

The existing evidence about the relationship between poverty and child outcomes suggests that it is not completely clear whether it is low income itself, or the complex set of circumstances that lead to poverty, that often results in poorer developmental outcomes. Improved knowledge of the mechanisms of this relationship will assist in determining the most effective way to improve the life chances of children whose families experience financial disadvantage.

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