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Here’s a link to a page that does a good job of outlining some of the causes (there are competing theories) of NPD (scroll down the page to ‘causes’:
http://www.ask.com/bar?q=what+causes+NPD&page=1&qsrc=0&dm=all&ab=0&title=Narcissistic+personality+disorder+-+Definition%2C+Description%2C+Causes&u=http%3A%2F%2Fwww.minddisorders.com%2FKau-Nu%2FNarcissistic-personality-disorder.html&sg=kkIoByfk0n6KxpS7jvRT4Y9Be3H0mHGXLoSjSh2bdZw%3D&tsp=1257752040919

There are so many takes on what causes NPD. Environmental, genetic susceptibility, etc. There seems to be similarity of argument among alot of what I have read for those instances when it is believed that a specific person likely developed NPD largely do to dysfunction in the home during early childhood. The argument tends to be that a baby must bond with a parent (usually the mother) in a stable relationship (usually said to occur between 2 -4 years of age) while the baby begins to construct his own personality (tough job - modern science can’t do it for the baby, mom and dad can offer support but cannot perform this task for the baby). During this time - the baby receives attention from the mother that ‘validates him’ by looking in her eyes and watching her react to him. He laughs - she lights up. He cries - she looks concerned and soothes him. It’s sort of a ‘I think thererfore I am’ effect that he undergoes during this time of bonding. A super nervous parent, a parent who is hospitalized and unavailable, a parent who has significant emotional damage, may have a hard time playing their role when baby needs them.
So perhaps a nervous parent sees the baby screaming and picks them up and starts to say “Nothing is wrong, there’s nothing to cry about...” or otherwise tries to ‘give’ the baby the thoughts and feelings the parent believes are ‘good’ or appropriate or comforting. If this happens too much - the baby’s own personality construction job is interrupted - as nervous mom tries to do some construction of her own.

An absent parent isn’t there at all and substitutes help (other family members etc.) but the baby isn’t bonded with them yet or has to play catchup. A wounded parent may be too harsh or neglecting them - an insufficient or unstable bond is present during baby’s construction project. Abuse at this age tears apart the construction process. Or perhaps another sibling is born and needs medical attention and both parents are overwhelmed trying to take care of both children.
Some babies make it through ok (some psychologists say that mom doesn’t have to be perfect, she can make mistakes, she just has to be ‘good enough’) and some fail to retain the personality they were trying to build. They can’t really separate from mom around age 4 as expected with their own personality intact. They move through development with this problem and intervention can stabilize and help some of them make it through but others, if their little construction projects are torn apart and they are unsupported, leave childhood without a personality. By the age of 18, it is believed that those who could have been rescued with intervention are no longer reachable. Science doesn’t know how to build a personality and the window of opportunity closes forever. I get sad thinking about this. There are said to be other contributing factors but your question was about Barry’s upbringing.
When I have heard about his early life - the main thing I notice is instability and what might be self-seeking parents. According to this recent article by Obama’s step brother, their father was physically abusive and Barack aknowledged that his father did not care about his wife and children. Here’s the link to that article: http://cbs11tv.com/national/Mark.Ndesandjo.Obama.2.1290838.html

The following article (link at the bottom) says that Barack never saw his father after around age 2 which meant that Baracks’ mother was without support and may have been in enough emotional upheaval herself to have any stamina left to give Barack. But when I read about his mother - she sounds like she wandered around seeking her own personality - as if she had none and was trying to acquire one.
This quote about Barack’s mother expresses the impression I get rather well “She felt that somehow, wandering through uncharted territory, we might stumble upon something that will, in an instant, seem to represent who we are at the core,” said Maya Soetoro-Ng, Mr. Obama’s half-sister.”
And wander she did: “...she married an African student at age 18. Then she married an Indonesian, moved to Jakarta, became an anthropologist, wrote an 800-page dissertation on peasant blacksmithing in Java, worked for the Ford Foundation, championed women’s work and helped bring microcredit to the world’s poor.” until she wandered right out of Baracks life. It sounded like baby may never have been the apple of her eye - which is where babies need to be, especially during the critical ages from around 2 - 4 years. Oh I forgot to post the link to the article about Baracks’ mother, here it is: http://www.barackoblogger.com/2008/03/nyt-profile-of-baracks-mother.html