Jurnal Ekonomi Malaysia

Family Expenditure Patterns in the Asian Financial Crisis and Children’s Cognitive Development in Indonesia

Faculty of Economics and Business
Universitas Diponegoro
Jl. Prof. Moeljono S. Trastotenojo, Tembalang, Kec. Tembalang
Kota Semarang, Jawa Tengah 50275, INDONESIA

Crawford School of Public Policy
Australian National University
JG Crawford Building, 132 Lennox Crossing
Canberra ACT 2600, AUSTRALIA

ariskanurfajarrini@lecturer.undip.ac.id

Faculty of Economics and Business
Universitas Diponegoro
Jl. Prof. Moeljono S. Trastotenojo, Tembalang, Kec. Tembalang
Kota Semarang, Jawa Tengah 50275, INDONESIA

fathimahkurniawati@lecturer.undip.ac.id

Abstract

The objective of this study is to examine the impact of the 1997 Asian Financial Crisis on children’s cognitive development by analyzing how changes in family expenditure patterns affected cognitive outcomes. This study used data from IFLS2 to IFLS3 and applied Ordinary Least Squares, Propensity Score Matching, and Instrumental Variables techniques to analyze the impact of the financial crisis on children’s cognitive development through changes in family expenditure patterns. The results from the three estimations indicate that the decline in household expenditure had a negative impact on children’s cognitive development during the 1997 economic crisis. Children from families affected by the crisis exhibited lower cognitive performance, particularly among the low-income group. It indicates that there is a relationship between children’s cognitive and economic crisis that is influenced by parents’ inability to provide sufficient non-food expenditures. This study contributes to the literature by incorporating family expenditures into the explanation of the financial crisis’s effect. The role of cash assistance as a safety net is crucial so that children, especially those from low-income families, can enhance their cognitive abilities during a crisis, as it can serve as one of the coping mechanisms to meet their educational needs.

Keywords

Asian crisis; Children cognitive; IFLS; instrumental variable; propensity score matching
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Nurfajar Rini, Ariska and Kurniawati, Fathimah Family Expenditure Patterns in the Asian Financial Crisis and Children’s Cognitive Development in Indonesia. Jurnal Ekonomi Malaysia, –.

@article{rini2026family,
  title={Family Expenditure Patterns in the Asian Financial Crisis and Children’s Cognitive Development in Indonesia},
  author={Nurfajar Rini, Ariska and Kurniawati, FathimahNurfajar Rini, Ariska and Kurniawati, Fathimah},
  journal={Jurnal Ekonomi Malaysia},
  volume={},
  number={},
  pages={—},
 
}

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