Recent research consistently reports that persistent poverty has more detrimental effects on IQ, school achievement, and socioemotional functioning than transitory poverty, with children experiencing both types of poverty generally doing less well than never-poor children. Higher rates of perinatal complications, reduced access to resources that buffer the negative effects of perinatal complications, increased exposure to lead, and less home-based cognitive stimulation partly account for diminished cognitive functioning in poor children. These factors, along with lower teacher expectancies and poorer academic-readiness skills, also appear to contribute to lower levels of school achievement among poor children. The link between socioeconomic disadvantage and children's socioemotional functioning appears to be mediated partly by harsh, inconsistent parenting and elevated exposure to acute and chronic stressors. The implications of research findings for practice and policy are considered.

This study of 422 two-caregiver African American families, each with a 10-11-year-old focal child (54% girls), evaluated the applicability of the family stress model of economic hardship for understanding economic influences on child development in this population. The findings generally replicated earlier research with European American families. The results showed that economic hardship positively relates to economic pressure in families. Economic pressure was related to the emotional distress of caregivers, which in turn was associated with problems in the caregiver relationship. These problems were related to disrupted parenting practices, which predicted lower positive child adjustment and higher internalizing and externalizing symptoms. The results provide significant support for the family stress model of economic hardship and its generalizability to diverse populations.

Family processes affecting the socioemotional functioning of children living in poor families and families experiencing economic decline are reviewed. Black children are of primary interest in the article because they experience disproportionate shares of the burden of poverty and economic loss and are at substantially higher risk than white children of experiencing attendant socioemotional problems. It is argued that (a) poverty and economic loss diminish the capacity for supportive, consistent, and involved parenting and render parents more vulnerable to the debilitating effects of negative life events, (b) a major mediator of the link between economic hardship and parenting behavior is psychological distress deriving from an excess of negative life events, undesirable chronic conditions, and the absence and disruption of marital bonds, (c) economic hardship adversely affects children's socioemotional functioning in part through its impact on the parent's behavior toward the child, and (d) father-child relations under conditions of economic hardship depend on the quality of relations between the mother and father. The extent to which psychological distress is a source of race differences in parenting behavior is considered. Finally, attention is given to the mechanisms by which parents' social networks reduce emotional strain, lessen the tendency toward punitive, coercive, and inconsistent parenting behavior, and, in turn, foster positive socioemotional development in economically deprived children.

Using latent variable structural equation modeling, a family economic stress model that links economic well-being to child well-being in an ethnically diverse, low-income sample of 419 elementary school-age children was evaluated. The sample was 57% African American and 28% Hispanic, and most families were headed by single mothers. The results provided support for the position that family process is a critical mediator of the effects of economic hardship on children's social adjustment. Lower levels of economic well-being, and the corollary elevated perceptions of economic pressure indirectly affected parenting behavior through an adverse impact on parental psychological well-being. Distressed parents reported feeling less effective and capable in disciplinary interactions with their child and were observed to be less affectionate in parent-child interactions. In turn, less than optimal parenting predicted lower teacher ratings of children's positive social behavior and higher ratings of behavior problems. Multiple-group analyses revealed that the pathways by which economic hardship influences children's behavior appear to operate similarly for boys and girls, and for African American and Hispanic families.

Using interview data from a sample of 241 single African American mothers and their seventh- and eighth-grade children, this study tests a model of how 2 economic stressors, maternal unemployment and work interruption, influence adolescent socioemotional functioning. In general, these economic stressors affected adolescent socioemotional functioning indirectly, rather than directly, through their impact on mothers' psychological functioning and, in turn, parenting behavior and mother-child relations. Current unemployment, but not past work interruption, had a direct effect on depressive symptomatology in mothers. As expected, depressive symptomatology in mothers predicted more frequent maternal punishment of adolescents, and this relation was fully mediated by mothers' negative perceptions of the maternal role. More frequent maternal punishment was associated with increased cognitive distress and depressive symptoms in adolescents, and consistent with predictions, these relations were partially mediated by adolescents' perceptions of the quality of relations with their mothers. Increased availability of instrumental support, as perceived by mothers, predicted fewer depressive symptoms in mothers, less punishment of adolescents, and less negativity about the maternal role. Both economic stressors were associated with higher levels of perceived financial strain in mothers, which in turn predicted adolescents' perceptions of economic hardship. Adolescents who perceived their families as experiencing more severe economic hardship reported higher anxiety, more cognitive distress, and lower self-esteem.