Abstract: Family income plays a crucial role in child development, which has been recognized by a majority of developmental psychologists. Previous research indicated that although family poverty serves as a risk factor in children’s development, warm and cohesive family environment protects low-income children from poor developmental outcomes. However, previous research mainly focused on children’s ill-being as outcomes, while less attention has been devoted to their well-being. The aim of the present study was to investigate the associations between family income and children’s social competence in early childhood. Furthermore, through examining the mediating role of family socio-cultural environment and the moderating role of family affective environment in the associations between family income and children’s social competence, the present research also represents a specific program to identify the mechanisms underlying the effect of family income.
Based on a sample of 325 preschoolers aged 3 to 5 and their mothers and teachers, the present study examined the associations between family income, child general social competence, quality of teacher-child relationships and family environment. Hierarchical regression analyses were applied to detect the effects of family income on children’s social competence as well as the mediating role of family socio-cultural environment and the moderating role of family affective environment in the effects of family income.
Results indicated that after controlling for the effects of child gender, grade and parental education, family income displayed a main effect on general social competence as well as on quality of teacher-child relationships, in which high-income children were more socially competent than their low-income counterparts. Family intellectual-cultural and active-recreational orientations served to mediate the association between family income and child general social competence, and family control served to moderate this association in that high family control predicted a positive association (simple slope = 2.63, p < 0.05) while low family control predicted no significant association between family income and child general social competence. Additionally, family control and family conflict also served to moderate the association between family income and quality of teacher-child relationships in that high family control and conflict predicted a positive association between them (simple slope = 6.33, p = 0.001; simple slope = 5.60, p < 0.01) while low family control and conflict predicted no significant association.
These findings highlight the importance of examining the role of family income in child development in modern China, and of expanding the existing research on family income by underlying the role of family environment in the effect of family income on children’s social well-being.

Key words: family income, social competence, family socio-cultural environment, family affective environment, mediation, moderation