College graduates earn higher wages than high school graduates by age 30. Among women, the advantages of a college degree decline somewhat as they age, although they are still substantial at age 50; for men, the advantage of a college degree grows throughout the life cycle. Most previous research on returns to higher education has focused on income at a single point in time or averaged over multiple years; our contribution is to study how returns vary by age. We also document how these patterns vary by the propensity of graduating from college. We find modest wage returns for mid-propensity college graduates, but large returns for low-propensity and, for men, high-propensity college graduates. Our results rely on propensity score–based matching combined with multilevel growth curve models applied to data from the National Longitudinal Survey of Youth 1979 cohort.

Background

Childhood family income variation is an understudied aspect of households' economic context that may have distinct consequences for children. We identified trajectories of childhood family income over a 12-year period, and examined associations between these trajectories and later psychiatric disorders, among individuals born in Sweden between 1987 and 1991 (n=534 294).

Methods

We used annual income data between the ages of 3-14 years and identified 5 trajectories (2 high-income upward, 1 downward and 2 low-income upward trajectories). Psychiatric disorders in the follow-up period after age 15 were defined from International Classification of Disease (ICD)-codes in a nationwide patient register. Multiadjusted risks for all psychiatric disorders, as well as for specific psychiatric diagnoses, were calculated as HRs with 95% CIs.

Results

Of the 5 identified income trajectories, the constant low and the downward trajectories were particularly associated with later psychiatric disorder. Children with these trajectories had increased risks for psychiatric disorder, including mood, anxiety, psychotic disorders and attention deficit/hyperactivity disorder. The association remained, even after adjusting for important variables including parental psychiatric disorder. In contrast, the relationship was reversed for eating disorders, for which children in higher income trajectories had elevated risks.

Conclusions

Findings show that children growing up in a household characterised by low or decreasing family income have an increased risk for psychiatric disorder. Continued work is needed to reduce socioeconomic inequalities in psychiatric disorders. Policies and interventions for psychiatric disorders should consider the socioeconomic background of the family as an important risk or protective factor.