Children develop a much clearer sense of time at about 3 years of age. They know their daily routines and show an interest in learning about the routines of others. Preschoolers understand that certain special events, like birthdays or holidays, occur only periodically, but they have no sense of the length of a year.
References:
Shelov, S. P. (Editor-in-Chief). (2004). Caring for Your Baby and Young Child: Birth to Age 5. The American Association of Pediatrics. Revised edition. New York: Bantam Books.
