Adverse Childhood Experiences, Poverty, and Inequality
Toward an Understanding of the Connections and the Cures

John F Tomer


Despite Alfred Marshall’s early recognition of the importance of mothering, human capital theory scarcely reflects the role of the home environment as a factor influencing the production of human capital. This paper looks deeply into the earliest phase of child development to understand its implications for human capital theory. Recently, important noneconomic research has revealed the growth of adverse childhood experiences (ACEs) among young children and how this impairs their brain functioning. Accordingly, this paper explores the role of ACEs for understanding the growth of poverty and inequality.

In contrast to other socio-economic theories explaining the growth of inequality of academic achievement, this paper focuses on the magnitude and growth of ACEs and poor parenting within the lower socio-economic class. Other theories no doubt have some validity, but if they leave out ACEs, they are missing a crucial causal factor. The implications of this theory for remedies to ACEs are explored. These remedies involve different ways to build human capital during the early childhood so that children will arrive at school with their brains unimpaired. The caring work of making human capital investments works better if they are part of a caring economy and part of a sensible human capital strategy.

Published on 5 Feb 2014 in World Economic Review No 3, 2014