The economic consequences of unwed motherhood

by on September 3, 2008 at 10:58 am in Economics | Permalink

This was published in the American Economic Review in 1994:

We estimate the long-run and life-cycle effects of unplanned children on unwed mothers by comparing unmarried women who first gave birth to twins and unmarried mothers who bore singletons.  We find large short-term effects of unplanned births on labor-force participation, poverty, and welfare recipiency among unwed mothers, but not among married mothers.  Although most of the adverse economic effects of unplanned motherhood dissipate over time for whites, there are larger and more persistent negative effects on black unwed mothers.

Notice that comparing one birth to two, rather than zero to one, tries to address the identification problem, namely that early pregnancy may be correlated with other unfavorable conditions.  For the curious, here are many related articles.  And here is a very useful literature review, which suggests inconclusive results.

1 spencer September 3, 2008 at 11:29 am

ARE YOU SERIOUS??

The difference between twins and singleton birth is a measure of the impact of unwed mothers having children????

Shouldn’t it be a comparisons between having no children and one child ???

2 Hopefully Anonymous September 3, 2008 at 12:10 pm

Prof. Cowen,
This is a great pedagogic approach to the headlines.

3 josh September 3, 2008 at 12:47 pm

agreed with person. you don’t think it has any bearing on reality, spencer?

4 jason voorhees September 3, 2008 at 1:15 pm

Spencer – The problem is one of identification. Comparing mothers with one child to the same person who has no child is going to be problematic since motherhood is not randomly assigned to young people. There’s many unobserved differences between young mothers and a young woman, many of which may be correlated with having a child. We can try to control for them, but the unobserved heterogeneity problems will still persist. Twins are often used in studies like these because having a twin is basically a random event, and thus conditional on women who have children, we can observe the effect of an additional child on some maternal outcome, as well as on the child’s outcome. It’s of course only valid at that local margin, so it’ll depend on whether you think we can learn something about going from 0 to 1 that is similar to what we learned by going from 1 to 2.

5 Sol September 3, 2008 at 1:53 pm

It might not make the paper ridiculous, exactly, but if the opportunity cost difference between 0 and 1 is much higher than the difference between 1 and 2 (as I think it is), then it makes it not terribly accurate.

Though I guess it probably does set a good solid lower bound on the cost of having a child out of wedlock, which is a worthwhile piece of information.

6 jason voorhees September 3, 2008 at 2:58 pm

To your point. Going from 0 to 1 does seem to me, too, to be different than going from 1 to 2. I don’t know if it’s a difference in degree or kind, though. The problem is that, again, we can’t randomly induce a child to mothers and do the comparisons you’re wanting. We can, though, do the latter. The twin experiment at least allows us a chance to understand at the margin what an additional child does, conditional on the characteristics of women who already choose to have adolescent births. You’re saying you can’t learn anything about this to generalize elsewhere. I’m not so sure. Seems like what we can learn here is that probably going from 0 to 1 will be at least as bad as what we found going from 1 to 2 – a lower bound, like Soi said. That may be the best we can actually learn, unless you have a better identification solution. Sometimes, you have to settle for the second best when it comes to social science.

7 Ben September 3, 2008 at 3:34 pm

Another important issue is that in single parent households there is one potential income, but in two parent households there are two.

So, even if becoming a single parent does not impact your labor supply or educational attainment, it still makes you more likely to be in poverty and using government transfer programs–because there is only one potential earner. i think a lot of this literature misses this point.

8 NE1 September 3, 2008 at 4:32 pm

Without reading the paper: Are women more or less likely to abort/put up for adoption if they know they are having twins (seems like this would be easy data to get from clinics, agencies)? To what extent is having the twins an indicator of family/local support or optimism? But maybe I’m missing the point.

9 JSK September 4, 2008 at 9:11 am

@A person:
filled with a strong dose of sampling error

A bit trivial perhaps but don’t you mean selection bias?

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11 kate May 15, 2009 at 10:49 pm

It seems we will be in economy ression for quite a long time. We can see the economy crisis effect everywhere.

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