Abstract
The existing literature on welfare effects on marriage and fertility has largely focused on groups of white and black women. By contrast, Hispanic women have received little attention. This paper examines the effects of welfare generosity on a sample of young Hispanic women’s premarital fertility and marriage choices. A bivariate competing risks duration model framework allows us to identify the process of young women’s premarital fertility and the process of marriage, effectively controlling for observed characteristics and unobservables. Our findings indicate a 10% increase in welfare generosity results in a 10% increase in premarital births and a 7% decrease in marriages by age 24; both effects are significant.
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Notes
Blank (2002) provides a review of more recent literature, including studies examining the impact of welfare reform on female headship.
No women in our sample had a child before age 13.
Moffitt et al. (1998) analyze the extent of cohabitation among welfare recipients. They find that a significant proportion of single mothers cohabitate. Our results are consistent with their findings since we focus our attention on young women at the time of their first premarital birth while their sample includes all single women.
The test measures arithmetic reasoning, word knowledge, paragraph composition, and numeric operations. It was administered to most of the subjects in the NLSY and is commonly used as a measure of unobserved ability.
This measure of welfare is defined in Moffitt (1994) page 626, footnote 12. Like Moffitt, we did not find significant differences when using the AFDC variable instead of Moffitt’s index of welfare generosity.
Cameron and Trivedi (2005, chapters 17–19) provide a good textbook treatment of the hazard rate or survival models, including competing risks and economic applications.
We find that the large set of variables explains more than the small set. Taking into account that competing risk models are highly nonlinear, one possible explanation is that the large set of explanatory variables explains some confounding effects in the marriage and fertility processes and this allows for a more precise estimate of welfare effects.
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Canals-Cerdá, J., Gurmu, S. Premarital Birth Among Young Hispanic Women: Evidence from Semiparametric Competing Risks Analysis. Atl Econ J 36, 421–440 (2008). https://doi.org/10.1007/s11293-008-9148-4
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DOI: https://doi.org/10.1007/s11293-008-9148-4