The Impact of Welfare on Young Mothers' Subsequent Childbearing Decisions

Acs, Gregory

doi:10.2307/146151

Cited by 69 publications

(53 citation statements)

References 14 publications

(7 reference statements)

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“…For example, Fairlie and London (1997) report a family cap effect (on the likelihood of a nonmarital birth) of minus 60 percent that is not statistically significant at the 0.10 level. Acs (1996) appears to have encountered similar difficulties, albeit with smaller samples sizes. That more recent studies have not been characterized by relative imprecise estimates may well be related to the fact that they primarily rely on state-level panel data as apposed to micro data (Horvath and Peters 1999;Kearny 1994;Levine 2002;and Joyce et al 2004).…”

Section: Limitationsmentioning

confidence: 89%

The effects of family caps on the subsequent fertility decisions of never-married mothers

Wallace

2009

J Pop Research

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Family caps seek to reduce fertility among welfare recipients by denying additional cash assistance to recipients that have children while on welfare. A necessary condition for family caps to be an effective policy tool is that welfare recipients respond to financial incentives in making decisions that affect subsequent fertility outcomes. In this paper I use data from the 2001 panel of the Survey of Income and Program Participation (SIPP) to examine whether welfare mothers respond to the incentive provided by the AFDC/TANF system in determining whether or not to have a second child. The estimates presented in this paper suggest that family caps do not have an effect on subsequent child-bearing among never-married women.

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Section: Limitationsmentioning

confidence: 89%

The effects of family caps on the subsequent fertility decisions of never-married mothers

Wallace

2009

J Pop Research

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“…Blau and Robbins (1989) find that a greater availability of childcare encourages fertility. Several papers exploit changes in the Aid to Families with Dependent Children program and recent welfare reforms to study potential effects on fertility (see Acs [1996] Fairlee and London [1997], Rosenzweig [1999], Joyce, Kaestner, and Korenman [2002], and Kearny [2002]). Overall, this literature finds no, or modest, effects.…”

Section: Literature Reviewmentioning

confidence: 99%

Do Financial Incentives Affect Fertility?

Cohen

Dehejia

Romanov³

2007

SSRN Journal

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This paper investigates empirically whether financial incentives, and in particular governmental child subsidies, affect fertility. We use a comprehensive, nonpublic, individual-level panel dataset that includes fertility histories and detailed individual controls for all married Israeli women with two or more children from 1999-2005, a period with substantial variation in the level of governmental child subsidies but no changes in eligibility and coverage. We find a significant positive effect on fertility, with the mean level of child subsidies producing a 7.8 percent increase in fertility. The positive effect of child subsidies on fertility is concentrated in the bottom half of the income distribution. It is present across all religious groups, including the ultra-Orthodox Jewish population whose religious principles forbid birth control and family planning. Using a differences-indifferences specification, we find that a large, unanticipated reduction in child subsidies that occurred in 2003 had a substantial negative impact on fertility. Overall, our results support the view that fertility responds to financial incentives and indicate that the child subsidy policies used in many countries can have a significant influence on incremental fertility decisions.

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“…In particular, we introduce into utility functions a new argument called "social approval" (or "stigma" or "values")5 that is exogenous for individuals but is determined endogenously as a function of all individual behavior in past generations.6 Thus, the See, for example, Hoynes (1996) for a discussion of these trends, and Moffitt, Ribar and Wilhelm (1996) for an intriguing political economy explanation of the decline in benefits. Moffitt (1992), Murray (1993) and Acs (1994) examine differences between studies and find that there is only mixed evidence of a significant effect of welfare on illegitimacy. While Jackson and Klerman (1995) and Clarke and Strauss (1995) have demonstrated a positive link, Hoynes (1995), Duncan and Hoffman (1990), Lundberg and Plotnick (1990) and Ellwood and Bane (1985) have found either mixed results or failed to establish a significant relationship.…”

Section: Introductionmentioning

confidence: 99%

Social Approval, Values, and AFDC: A Re-Examination of the Illegitimacy Debate

Nechyba¹

1999

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Empirical attempts to link teenage out-of-wedlock births to the incentive structure of Aid to Families with Dependent Children (AFDC) have met with mixed results. This has suggested to many researchers that, while the AFDC program contains incentives for poor women to have children out-ofwedlock, these incentives cannot be the primary culprit responsible for current levels of out-of-wedlock births. This paper presents a model that is consistent with the stylized facts and the empirical evidence but establishes a mechanism through which AFDC could in fact be the primary reason for observed levels of illegitimacy. The model is standard with one exception: How much utility individuals are able to obtain from having a child depends on the level of "social approval" that is associated with having out-of-wedlock children. This social approval is a function of the fraction of individuals in all previous generations who chose to have children out-of-wedlock, where the effect of each generation diminishes with time. While the model is successful in replicating the stylized facts on AFDC and illegitimacy and establishes a link between the two through a government induced change in "values," it also demonstrates that welfare reform aimed at reducing the incentives for poor women to have out-of-wedlock births may not be as effective as policy makers who believe in a causal link between AFDC and illegitimacy might suspect. IntroductionConcern over the rise in out-of-wedlock births, especially among teenagers, and sharp increases in the number of single headed households is widespread and growing. In the three decades following 1960, illegitimate births as a percentage of total live births rose from below 5% to over 30%, and the fraction of households headed by females rose similarly from 7% to well over 20%. 1 Today, close to one third of all births nationwide, approximately two thirds of black births and as many as 80% of births in some central cities are to single mothers. At the same time, more than half of all poor families are made up of female headed households, and children are more likely to live in poverty than members of any other age group. Given the strong link between socioeconomic background during childhood and a variety of indicators of future success, these trends are understandably disturbing to policymakers who are increasingly searching for new initiatives to encourage family formation.One set of such proposed initiatives involves either eliminating long-standing social programs which assist single mothers or altering their incentive structures dramatically. Such proposals arise from the argument that US social policy may be a significant contributing factor to increased illegitimacy and decreased family formation, a notion that is widely discussed in the literature and broadly supported by rational choice theory. Becker (1991), for example, suggests that a program like Aid to Families with Dependent Children (AFDC) "raises the fertility of eligible women, including single women, and also encoura...

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The Impact of Welfare on Young Mothers' Subsequent Childbearing Decisions

Cited by 69 publications

References 14 publications

The effects of family caps on the subsequent fertility decisions of never-married mothers

The effects of family caps on the subsequent fertility decisions of never-married mothers

Do Financial Incentives Affect Fertility?

Social Approval, Values, and AFDC: A Re-Examination of the Illegitimacy Debate

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