- A positive relationship between income and child outcomes has been observed in data from numerous countries. A key question concerns the extent to which this association represents a causal relationship as opposed to unobserved heterogeneity. We use data from the National Longitudinal Survey of Children and Youth to implement a series of empirical strategies for estimating the existence and size of the effect of income on behavioural-emotional outcomes. We also examine the role of parenting style. Our results indicate that there is little evidence of an effect of income on behavioural-emotional scores. The exclusion of parenting style from the models was found to not bias the estimated income effect, but parenting style was found to have a consistent impact on child outcomes.