At that age I read them mostly rhyming, rhythmic stories. Mostly for my own sanity, because when they found something they loved they wanted to hear it again and again and again. My favourites include The Book about Moomin, Mymble and Little My and Who Will Comfort Toffle?, both by Tove Jansson.

Later on, I've read them a lot of Hans Christian Andersen and other fairy tales, often in older, slightly archaic translations, because it was good to get them to fall asleep.

Now that they can read a bit themselves, they have a ton of opinions about what they should read, and my philosophy is mainly to encourage reading. There seems to be lots and lots of new children's books coming out, and I think most of what they read is pretty recently written by Swedish authors. Handbok för superhjältar is such a smash hit that I wouldn't be surprised if it's translated soon, though. Young girl finds a Handbook for Superheroes on a dusty shelf in a library or an old bookstore and through the powers of reading and training, evolves super powers of her own. And then she fights crime and bullying. Cool illustrations and easy text, so good for new readers (if and when they are translated into English).

As to what effect books has on impressionable young minds, I'm not sure. They do have effect, but when I go back and re-read scifi I read as a teen, half the story isn't there. Instead of the rich stories and interesting characters I now find flat stories and cardboard characters. But that means that the story as I read it, and the story that impressed me, was largely constructed in my own imagination.

Then again I wouldn't say the content doesn't matter. The first real book I read was "Small is Beautiful". I think I read that one half a dozen times before reading anything else. It is the story about a small dragon that lives with the lizards, but wants to be big. It doesn't listen when the lizards tells him that "Small is beautiful, lagom is best". So it hunts more and more, and gets other animals to hunt for it, for a share of the meat. Eventually it starts growing more heads, I in particular remember the smooth talking head and the fire breathing head. It becomes so large that it dominated the whole forest and the wolf pack decides it needs to be the avant garde of the animals and attack it. Their attack on the dragon fails though, and the dragon grows larger and larger until it poops so much that it's destroying the forest itself. In the end all the animals unite, from the smallest lizard to the largest bear and only then can they overthrow the industrial capitalistic system, I mean the dragon, and a new era can start in the forest. Though in the final picture a dragon egg is resting among the lizard eggs, but perhaps this time the dragon will listen to the lizards?

Given that I have not read it since, it might not have been as obvious eco anarchistic propaganda as I remember it. Though with that title, it probably was. And maybe it was that I was attracted to the content based on already forming values? Though again, maybe it did have that strong an effect on me. In which case, I really should track down a copy and read it to the kids, just to make sure.