Chapter 2. Early Skills and Adult Life Satisfaction Mediators We explore two broad channels which may mediate the relationship between early skills and adult life satisfaction at age 46: income and daily functioning.5 In the first channel, we consider whether the development of skills during childhood might lead to better educational and employment opportunities, resulting in higher income levels. These higher income levels, consequently, can provide more resources to individuals (e.g., improved living conditions, healthcare, leisure activities etc.) which, in turn, might contribute to higher overall life satisfaction. The relationship between early skills and adult income (e.g., Charette & Meng, 1998; Crawford & Cribb, 2013; McIntosh & Vignoles, 2001; Vignoles et al., 2011) and the relationship between income and life satisfaction (e.g., Cheung & Lucas, 2015; Diener & Biswas-Diener, 2002; Kahneman & Deaton, 2010; B. Stevenson & Wolfers, 2013) are well-documented in the literature. In this chapter, we consider the individual’s total take-home income (after tax and deductions) at age 46. In the second channel, we consider that the development of skills during childhood may affect how individuals function in daily life, which might, in turn, improve their satisfaction in life. For this purpose, we use five measures of the 36-Item Short Form Health Survey (SF-36): role limitations due to physical health, role-limitations due to emotional problems, social functioning, energy/fatigue, and pain. Role limitations refer to the constraints or restrictions that hinder an individual’s ability to carry out their usual roles and responsibilities (e.g., whether the individual had to cut down time spent on work, whether 5Note that we only examine mediation at age 46 due to data availability. 22
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