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The effect of incremental benefit levels on births to AFDC recipients

Author

Listed:
  • Robert W. Fairlie

    (Department of Economics, University of California at Santa Cruz, Santa Cruz, California)

  • Rebecca A. London

    (Berkeley Planning Associates, Berkeley, California)

Abstract

We examine the relationship between fertility and incremental AFDC benefits using the 1990 Panel of the Survey of Income and Program Participation (SIPP). Estimating a logit equation for the probability of a higher-order birth among a sample of AFDC recipients, we find a positive coefficient (although statistically insignificant) on the incremental AFDC benefit level. However, we find a positive correlation between incremental benefits and fertility for several nonrecipient comparison groups which is larger than the positive correlation for AFDC recipients. This finding suggests that the previously estimated relationship between incremental benefits and fertility among AFDC recipients is largely the result of a spurious correlation. We find similar results among whites, blacks, and never-married women, but less consistent results among Hispanics and divorced or separated women. We infer from these results that family cap policies, which eliminate the incremental benefits entitled to AFDC recipients who have additional children, are not likely to result in a large reduction in the number of out-of-wedlock births to AFDC recipients.

Suggested Citation

  • Robert W. Fairlie & Rebecca A. London, 1997. "The effect of incremental benefit levels on births to AFDC recipients," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 16(4), pages 575-597.
    • Handle: RePEc:wly:jpamgt:v:16:y:1997:i:4:p:575-597
    DOI: 10.1002/(SICI)1520-6688(199723)16:4<575::AID-PAM4>3.0.CO;2-D
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    References listed on IDEAS

    as
    1. Gary S. Becker, 1981. "A Treatise on the Family," NBER Books, National Bureau of Economic Research, Inc, number beck81-1, August.
    2. Gregory Acs, 1996. "The Impact of Welfare on Young Mothers' Subsequent Childbearing Decisions," Journal of Human Resources, University of Wisconsin Press, vol. 31(4), pages 898-915.
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    Cited by:

    1. Phillip B. Levine, 2001. "The Sexual Activity and Birth-Control Use of American Teenagers," NBER Chapters, in: Risky Behavior among Youths: An Economic Analysis, pages 167-218, National Bureau of Economic Research, Inc.
    2. Gregory Acs & Sandi Nelson, 2004. "Changes in living arrangements during the late 1990s: Do welfare policies matter?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 23(2), pages 273-290.
    3. Joseph Sabia, 2008. "Blacks and the family cap: pregnancy, abortion, and spillovers," Journal of Population Economics, Springer;European Society for Population Economics, vol. 21(1), pages 111-134, January.
    4. Kelaher, Margaret & Dunt, David & Dodson, Sarity, 2007. "Unemployment, contraceptive behaviour and reproductive outcomes among young Australian women," Health Policy, Elsevier, vol. 82(1), pages 95-101, June.
    5. Chen, Shuo & Xie, Bin, 2025. "The abolition of People’s Communes and fertility decline in rural China," Journal of Development Economics, Elsevier, vol. 172(C).
    6. Rannveig Kaldager Hart & Taryn A. Galloway, 2023. "Universal Transfers, Tax Breaks and Fertility: Evidence from a Regional Reform in Norway," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 42(3), pages 1-32, June.
    7. Ann E. Horvath-Rose & H. Elizabeth Peters, 2000. "Welfare Waivers and Non-Marital Childbearing," JCPR Working Papers 128, Northwestern University/University of Chicago Joint Center for Poverty Research.
    8. Reagan Baughman & Stacy Dickert-Conlin, 2009. "The earned income tax credit and fertility," Journal of Population Economics, Springer;European Society for Population Economics, vol. 22(3), pages 537-563, July.
    9. Ann Horvath-Rose & H. Peters & Joseph Sabia, 2008. "Capping Kids: The Family Cap and Nonmarital Childbearing," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 27(2), pages 119-138, April.
    10. Melissa Schettini Kearney, 2004. "Is There an Effect of Incremental Welfare Benefits on Fertility Behavior?: A Look at the Family Cap," Journal of Human Resources, University of Wisconsin Press, vol. 39(2).
    11. Dyer, Wendy Tanisha & Fairlie, Robert W., 2003. "Do Family Caps Reduce Out-of-Wedlock Births? Evidence from Arkansas, Georgia, Indiana, New Jersey and Virginia," Center Discussion Papers 28431, Yale University, Economic Growth Center.
    12. Jagannathan, Radha & Camasso, Michael J., 2011. "Message and price components of Family Caps: Experimental evidence from New Jersey," Evaluation and Program Planning, Elsevier, vol. 34(3), pages 292-302, August.
    13. Ted Joyce & Robert Kaestner & Sanders Korenman & Stanley Henshaw, 2004. "Family Cap Provisions and Changes in Births and Abortions," NBER Working Papers 10214, National Bureau of Economic Research, Inc.
    14. Fein, David J., 2001. "Will welfare reform influence marriage and fertility? Early evidence from the ABC demonstration," Evaluation and Program Planning, Elsevier, vol. 24(4), pages 427-444, November.
    15. Rebecca M. Blank, 2002. "Evaluating Welfare Reform in the United States," Journal of Economic Literature, American Economic Association, vol. 40(4), pages 1105-1166, December.
    16. Kevin Milligan, 2005. "Subsidizing the Stork: New Evidence on Tax Incentives and Fertility," The Review of Economics and Statistics, MIT Press, vol. 87(3), pages 539-555, August.
    17. Parada, Cecilia, 2024. "Fertility responses to cash transfers in Uruguay," World Development Perspectives, Elsevier, vol. 33(C).
    18. Taryn Ann Galloway & Rannveig Kaldager Hart, 2015. "Effects of income and the cost of children on fertility. Quasi-experimental evidence from Norway," Discussion Papers 828, Statistics Norway, Research Department.
    19. Michael J. Camasso, 2004. "Isolating the Family Cap Effect on Fertility Behavior: Evidence From New Jersey's Family Development Program Experiment," Contemporary Economic Policy, Western Economic Association International, vol. 22(4), pages 453-467, October.
    20. Santiago Garganta & Leonardo Gasparini & Mariana Marchionni & Mariano Tappatá, 2017. "The Effect of Cash Transfers on Fertility: Evidence from Argentina," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 36(1), pages 1-24, February.

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