Research on coercion theory provides strong evidence that inadequate discipline and poor parental monitoring are key factors in the emergence and maintenance of antisocial behavior. However, psychosocial maladjustment is not the only outcome of interest-it is critical to society that children become competent and productive adults. In this chapter, we broaden the focus of the coercion model to examine the processes involved in the development of competency in early childhood, a less developed area of research at the Oregon Social Learning Center (OSLC). We consider the roles that coercion theory parenting constructs (positive reinforcement, effective discipline, and monitoring), in combination with the early contextual variables of social referencing, attachment, and scaffolding (i.e. parental instructional style), might play in the development of competence in young children. We draw on a variety of sources for the discussion in this chapter. Numerous OSLC studies have included such contextual variables. In some instances, the research tested the validity of direct versus parenting-mediated paths to child outcomes. More commonly, the research examined various sub-components of the model-for example, the relationship between attachment and parenting characteristics.