The report said parenting style was more influential than income
Children brought up according to "tough love" principles are more successful in life, according to a study.
The think tank Demos says a balance of warmth and discipline improved social skills more than a laissez-faire, authoritarian or disengaged upbringing.
It says children aged five with "tough love" parents were twice as likely to show good character capabilities.
Report author Jen Lexmond said: "It is confidence, warmth and consistent discipline that matter most."
According to the report, qualities such as application, self-regulation and empathy were more likely to be developed in children whose parents employed a "tough love" approach.
It found that these qualities made "a vital contribution to life chances, mobility and opportunity".
The report said these characteristics were profoundly shaped in pre-school years.
The Building Character report analysed data from more than 9,000 households in the UK.
It found that children from the richest backgrounds were more than twice as likely to develop the key characteristics compared to those with the poorest origins.
Additionally, children whose parents were married were twice as likely to show such traits than children from lone parent or step-parented families, the report said.
But it added that when parental style and confidence were factored in, the difference in child character development between richer and poorer families disappeared.
The report concluded that this indicated that parenting was the most important influence - and the same result occurred when the family structure factor was analysed.
The report said that other positive influences included the main carer's level of education, and breast-feeding.
Girls were more likely to develop character capabilities by age five, while no connection was found between paid employment of either parent and children's characteristics.
The authors urged more support and information for families, and for children with disengaged or low-income parents to be given particular focus.
They recommended that the government's Sure Start programme should be refocused as a tool for early intervention, with less emphasis on childcare and more on development; improved pilots for the Family Nurse Partnership; and for health visitors to be given an early years role to help with parenting.
"There is some evidence that lower-income households face more difficulty in incubating these character capabilities," the report said.
"But the most important influence is the quality of parenting.
"Confident, skilful parents adopting a 'tough love' approach to parenting, balancing warmth with discipline, seem to be most effective in terms of generating these key character capabilities.
"An ambitious agenda for equality of opportunity will need to take the development of these capabilities seriously."
Ms Lexmond added: "Far from a 'soft' skill, character is integral to our future success and wellbeing."
Parentline Plus chief executive Jeremy Todd said the charity also supported the call for increased help for families.
But he said different children reacted differently to parenting styles.
"If we are to reduce the strangle-hold of cycles of deprivation, the issue of how we support families to raise children must be grasped," Mr Todd added.
"We welcome this report and hope that it stimulates debate among policy makers around how best to support families to transform our society into one where we top the league tables for outcomes for children and well-being."