I get a lot of calls from people who say, "I can't do anything because I don't have self-esteem."  My usual response: "b.s."  I don't wake up every day and tell myself, "Oh my gosh, I love you."  It's when I've done something that requires guts, sacrifice, or was extremely valuable to me that I'm proud of myself. 

Ever since the 60s, there has been a lot of psychobabble surrounding self-esteem.  People who buy into the "self-esteem movement" figure that the best way to combat low-esteem in kids is to artificially pump them up by saying things like, "You're wonderful," and, "That's the most beautiful piece of art I've ever seen."  However, this "person praise" does nothing to actually give them higher self-esteem.  You're only blowing smoke and treating them like animals ("You're such a good boy/girl" is something I say to my dogs). 

Instead, praise should be directed at a child's effort.  For example, tell them, "Wow. You really worked hard on that!"  This is what is called "process praise" - you're commenting on their diligence and persistence.  According to a study from the University of Chicago, kids are more likely to prefer challenging tasks and believe that intelligence and personality can improve with effort than youngsters who simply hear praise directed at them personally.  It sends the message that effort and actions are the sources of success and your approval.  If you're impressed by their effort, kids will put in more effort.  If you just say, "You're very good at this," that's it - they stay at that level. They won't try harder because they figure that they have already reached the pinnacle. 

By praising the process, actions, and strategies (e.g. "I'm impressed that you did your best and worked hard to stick with it"), kids try to do better and better to impress you and themselves. And what happens when they impress themselves? Their self-esteem goes up. 

The bottom line: You can't give your kids self-esteem. They have to earn it in their own minds.  Otherwise, you're just handing them praise balloons and turning them into narcissists.