Parents with limited resources are more likely to invest in children who show signs of higher cognitive function early in life. That is the central conclusion of a new study by Achyuta Adhvaryu and Anant Nyshadham, which looks at a health programme in Tanzania that provided iodine supplements to women of childbearing age.

The researchers have been able to track the health decisions made by parents and the health outcomes of children conceived during the programme. Their findings, which are published in the June 2016 Economic Journal, show that children exposed to iodine in utero – and who thus were likely to have higher cognitive potential – were breastfed for longer and received immunisations that reduced their risk of mortality and illness.

Parents may love all their children equally, but do they invest in them equally? As any parent can attest, a child''s development is always shaped by nature versus nurture – an ancient contest between the child''s innate strengths and weaknesses and the decisions parents make to nurture his or her growth.

In economic terms, children are born with certain endowments, predispositions to be intelligent or tall or fast that must be nurtured in order to be realised as a child develops. How parents allocate resources early in life – for example, providing a nutritious and diverse diet or spending time going over mathematics homework – can result in lifelong consequences for their offspring.

This leads to an important behavioural question: do children who seem more naturally predisposed to succeed in life receive more support from their parents during their early years? This study of an iodine supplementation programme in Tanzania suggests that parents in resource-poor settings are more likely to invest in children who show signs of higher cognitive function early in life.

Exposure to iodine in utero is a crucial determinant of cognitive development during pregnancy. Iodine enables the formation of neural networks, so if the micronutrient is lacking, these networks do not fully form, limiting the child''s future cognitive potential.

In response to widespread iodine deficiency among its citizens in the 1980s, the government of Tanzania began distributing iodine supplements to women of childbearing age. Maternal iodine levels peak when the mother receives the treatment, and then slowly decline over time. Therefore, children conceived close to when the mother receives the supplement have higher exposure than subsequent siblings.

By tracking parental health decisions and health outcomes of children conceived during this programme, it is possible to observe how parents allocate resources to children with higher cognitive function.

The researchers'' analysis of the data suggests three key findings:

• First, children who were exposed to adequate amounts of iodine in utero were breastfed for longer than similar children with less exposure. Extended breastfeeding has been shown to confer numerous health benefits that improve early childhood development and produce long-term health benefits.

• Second, children exposed to iodine were more likely to receive necessary immunisations, reducing the risk of mortality and illness.

• Third, the siblings of children with more iodine exposure were also more likely to receive immunisations.

These findings help to explain how parents react to the endowments of their children at birth. The authors comment:

''Recent studies suggest that in the developed world, it is more common for parents to invest in bringing lower IQ children up to speed than to focus resources more intensively on higher IQ children – although this phenomenon is not entirely explained by income.''

''In the resource-poor Tanzanian context, however, parents appear to be faced with a Sophie''s Choice of sorts, choosing to allocate resources to children who have a better chance of success.''

The fact that investments in siblings of treated children also change underscores the importance of ''spillovers'' within the household. There may be several mechanisms driving this effect.

One is that parents may achieve economies of scale from bringing multiple children in for routine immunisation, thereby lowering the cost of such a trip and making the investment less burdensome. An alternative is that parents may learn that extended breastfeeding leaves their children better off, and therefore incorporate the extended duration into their normal parenting duties.

The iodine treatment therefore appears to validate these investments for parents, not only for first children but also for subsequent children who did not benefit from in utero supplementation.

''Endowments at Birth and Parents'' Investment in Children'' by Achyuta Adhvaryu and Anant Nyshadham is published in the June 2016 issue of the Economic Journal. Achyuta Adhvaryu is at the University of Michigan Ross School of Business. Anant Nyshadham is at the University of Southern California.