An Economic Explanation of the Effect of Birth Order on Educational Achievement

The relationship between birth order and child's human capital is studied in this paper. A Microeconomic model is designed to analyze the intrahousehold behavior on resource allocation and its outcomes for children. Since adding up a child changes the method of intrahousehold resource allocation, the expenditures of investment in child's human capital has been changed too. The aim of this paper is to investigate the effect of birth order on educational achievement which measured by average of scores and score of math as two measures of educational quality and by years of schooling as a measure of quantity of education. In general, five samples from Tehran are used: the first includes primary students in grade 4 and the second and third samples cover single persons (male and female) who are at least 20 years old. The fourth and fifth samples include married persons (male and female) who are at least 35 years old. According to these data, the regression analysis is used to present evidence and test hypothesis. Results suggest that the increase of birth order reduces both the quantity and quality of children's education in the sense that the latest children have lower level of education than the earliest ones.