participants at the June preconference and December conference for their helpful suggestions and

Abstract: Teen out-of-wedlock mothers have lower education and earnings than peers who have children later. This study uses the National Educational Longitudinal Survey of 1988 (NELS) to examine the extent to which the apparent effects of out-of-wedlock teen fertility are not causal, but are due to pre-existing disadvantages of the young women and their families. We use a novel fixed-effect matching method to study this problem. We find that mothers-to-be were substantially disadvantaged before their teen out-of-wedlock fertility. At the same time, we cannot rule out that out-of-wedlock fertility reduces education substantially, although far less than the cross-sectional comparisons of means suggest. Acknowledgment: Paul Gertler and Bryan Lincoln were quite helpful. The second author will make code available to interested replicators. Our most serious social problem [is] the epidemic of teen pregnancies and births where there is no marriage.-- President Clinton, 1995 State of the Union Address While teen mothers are very likely to live in poverty and experience other forms of adversity, our results imply that little of this would be changed just by getting teen mothers to delay their childbearing into adulthood.-- Hotz, Sanders and McElroy, 1999 As the authors of both of the quotations above agree, teen mothers have lower average education and earnings than peers who have children later. At the same time, several studies find that

The difficulties experienced by young women who give birth as teenagers have been well-documented (Maynard, 1997). For instance, teen mothers are far less likely to work compared to other women who delay child-bearing. Their lower earnings places the family at far greater risk of falling into poverty. Teen mothers are also more likely to rely on public assistance to provide the family with a minimal living standard. These and other apparent costs of teen childbearing have led to the proposal of several policy alternatives designed to alleviate them. The three demonstrations projects discussed in this book represent such alternatives. This paper will synthesize the evidence from the existing nonexperimental literature regarding the labor market outcomes and public assistance receipt of teen mothers and the results of these three experiments. The nonexperimental literature has attempted to determine whether teen motherhood itself “causes ” the outcomes that follow, or whether the characteristics of women who give birth as teens are such that they would have experienced subsequent difficulties even in the absence of the birth. Recent research suggests that perhaps little, if any, of the worse labor market outcomes of teen mothers is directly attributable to giving birth as a teen. The experimental findings, which show policies directed at improving labor market outcomes for teen mothers are, at best, only modestly effective, seem to coincide with these