How Childhood Poverty in Homes and Neighborhoods Shapes Adult Outcomes

A long-term study from the Asian Development Bank shows that childhood poverty affects adult lives not only through low family income but also through poor community conditions such as weak schools, infrastructure, and social support. Children who grow up deprived across multiple family and community contexts earn less, learn less, and experience worse health and well-being decades later.

For decades, poverty has been measured by income alone. But new research from the Asian Development Bank, produced by its Economic Research and Development Impact Department in collaboration with Renmin University of China, shows that this narrow view misses much of what shapes a child’s future. Using 21 years of data from Indonesia, the study finds that where and how children grow up, inside their families and within their communities, matters just as much as how much money their households earn.

The research follows more than 8,000 Indonesians from childhood in 1993 into adulthood in 2014 using the Indonesia Family Life Survey, one of the most detailed long-running household datasets in the developing world. Indonesia offers a powerful case study: a country that reduced poverty rapidly while still struggling with deep inequalities across regions and social groups. The study asks a simple but critical question: which kinds of childhood deprivation leave the deepest marks later in life?

Growing Up Poor Has Many Faces

Instead of focusing solely on income, the researchers examine poverty through four lenses. At the family level, they examine economic hardship such as low consumption, poor housing, and lack of assets, alongside social factors like parents’ literacy, health, and physical presence. At the community level, they consider economic conditions such as roads, electricity, and access to services, as well as social features like schools, adult literacy, and local organizations.

Children who experienced deprivation in at least two of these areas are classified as “multi-context deprived.” By this broader definition, about 40% of Indonesian children in the early 1990s were growing up in serious disadvantage, far more than those identified as poor by income measures alone. This gap highlights the fact that many children were previously invisible to traditional poverty statistics.

Childhood Disadvantage Lasts Into Adulthood

The consequences of growing up in multi-context poverty are long-lasting. As adults, those who experienced early deprivation consume less, complete fewer years of schooling, and are far less likely to finish high school or attend college. They perform worse on basic cognitive tests and are more likely to smoke.

Health and well-being also suffer. Adults who grew up deprived are shorter, have lower body mass index, report worse mental health, and are less satisfied with their lives. These patterns remain strong even after accounting for age, gender, and other background factors. In short, early disadvantage follows people for decades, shaping both their economic prospects and their quality of life.

Communities Matter as Much as Families

One of the study’s most important findings is that poverty is not only a family problem. Growing up in a poor community has lasting effects, even for children from similar households. Weak infrastructure, limited schools, poor access to services, and low social support all leave scars.

While family poverty plays the biggest role in education and income later in life, community conditions matter more for health, mental well-being, and life satisfaction. This means that improving households without improving neighborhoods may leave major problems untouched. Children raised in healthier, better-connected communities tend to fare better as adults, regardless of family background.

Poverty Hurts Boys and Girls Differently

The study also finds that childhood poverty affects boys and girls in different ways. Girls suffer more in education. When families and communities face hardship, girls are more likely to lose years of schooling and miss out on college, especially when community resources are limited. This suggests that, in tough times, investments in boys’ education are often prioritized.

Boys, on the other hand, experience greater harm in physical health. Economic deprivation affects boys’ height and nutrition more strongly and increases their likelihood of smoking later in life. These differences reflect deep-rooted social norms about how resources are shared within families and communities.

Rethinking How Poverty Is Tackled

For policymakers, the message is clear. Cash transfers and household support remain essential, but they are not enough on their own. Investments in communities, in roads, electricity, schools, health services, and social institutions, can shape children’s futures just as powerfully as family income.

By showing that poverty operates across multiple, overlapping environments, the study challenges governments to rethink how they fight inequality. Children inherit more than their parents’ earnings. They inherit the places they grow up in. Tackling poverty across family and community settings, and across both economic and social dimensions, offers the best chance of breaking the cycle for good.