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Volume 8 Issue 4, April 2024

Unconditional child allowance and families’ spending behaviour

In 2021, the USA provided an unconditional child allowance to most families with children. Using anonymized mobile-location as well as debit and credit card data, Parolin et al. find that the allowance increased spending at childcare centres, health- and personal-care establishments, and grocery stores. On the other hand, there was no evidence that the allowance increased tobacco or alcohol purchases.

See Parolin et al.

Image: designer491/Alamy Stock Photo. Cover design: Bethany Vukomanovic.

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  • The past 35 years have seen Bayesian models applied to many areas of the cognitive and brain sciences, which suggests that reasoning and decision-making may be rational. Wishful thinking provides a serious challenge, as it questions a core assumption of Bayesian belief updating. Melnikoff and Strohminger develop a Bayesian model that uses affective prediction errors and meets this challenge.

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