this paper we study the relationship between the unemployment rate at the time of a baby's conception and health outcomes at birth, and we explore whether this relationship is due to the effect of the unemployment rate on fertility decisions or on the health-related behavior of pregnant women. Economic models of fertility suggest that women who choose to have children in recessions may differ from women who choose to postpone fertility. To the extent that these parental characteristics are related to children's health, differential fertility may result in differences in the health of children over the business cycle. At the same time, evidence suggests that individuals' health may improve during recessions, because the overall effect of recessions is to increase health-related activities (and to decrease risky behaviors). Therefore, changes in parental behavior over the business cycle could also affect the health of infants, even in the absence of compositional change

for helpful comments. The views expressed herein are those of the author and not necessarily those of the

Pennsylvania, and the University of Chicago for helpful comments, and to the National Institute on Aging and the National Science Foundation for financial support. The views expressed herein are those of the author and not necessarily those of the National Bureau of Economic Research.

This paper examines the long-term impact of legalized abortion on teenage out-ofwedlock childbearing, which has been in constant decline since the early 1990s in the United States. Our argument is that, to the extent that it prevented unwanted births, legalized abortion could have reduced the likelihood of the teenage out-of-wedlock childbearing for the cohorts born after the legalization. We adopt a non-parametric approach that allows for a separate effect on Whites and African-Americans of the 1970 legalizations in the repeal states- California, New York, Washington, Alaska, and Hawaii – and the Roe v. Wade ruling in 1973. After controlling for the size of birth cohort, we find that for African-Americans, both changes lead to a long-term reduction in out-of-wedlock teenage childbearing. For Whites, there is no evidence supporting a long-term effect of the 1970 legalizations, but the cohorts born after Roe v. Wade in the nonrepeal states show a reduction in teenage out-of-wedlock childbirth. Our findings are consistent with Levine et al. (1999), who find that the early legalization in the repeal states had a much stronger effect on the immediate fertility of Non-Whites than Whites. Also, our results show that legalized abortion can potentially account for at least 30 percent of the 45 percent decline in the teenage out-of-wedlock childbearing among 15-17 year olds for African-Americans and 35 percent of the 24 percent decline for Whites in the 1990s. Finally, since the fertility of African-Americans appears to be affected by legalized abortion earlier, our results suggest a potential reason for why teen out-of-wedlock childbearing for African-Americans started declining 3 years before than as it did for Whites.

While most countries are committed to reducing unintended childbearing, and thereby improve the well being of both mothers and children, there is little consensus on what means will actually achieve this goal. This paper investigates the importance of one proposed policy: subsidized contraception. I make use of a series of unusual Swedish policy changes where different regions beginning in 1989 started subsidizing the birth control pill to examine the consequences for women’s outcomes. The reforms are attractive because they were significant and applied to all types of oral contraceptives. On average the subsidy rate was 75 percent. My identification strategy takes advantage of the fact that the reforms were implemented successively and only targeted specific cohorts of young women, mostly teenagers. This generates plausibly exogenous variation in access to the subsidy. Using extensive Swedish population micro data and aggregated county level data I find that access to the subsidy significantly increased consumption of the pill, reduced teenage childbearing and lowered abortion rates. However, there is no evidence that the reforms affected: labor supply, marriage educational attainment, or welfare dependency. The estimates are robust to a number of different sensitivity checks. 2

This paper examines how teen sexual behavior responds to associated disease infection risks using the biannual 1993–99 waves of the Youth Risk Behavior Surveys. We estimate the effect of state level rates of AIDS and other sexually transmitted diseases on sexual behavior with probit regressions for the decision to have sex during the previous three months along with ordinary least squares, Tobit, and negative binomial models for the number of sexual partners during that time. We divide the sample by gender and include individual controls for age, grade, and race, as well as state level per capita income and birth rates and indicators for state and year. The results show that AIDS and gonorrhea rates are significantly negatively related to the probability that male teens have sex. Conditional on having sex, however, males do not respond to changes in risk. Female sexual behavior also appears unresponsive to infection risks

help with data, as well as various Teenage Pregnancy Coordinators and Health Authority staff who provided information and/or comments. Word count (including tables, references & abstract): 8,189Random Behaviour or Rational Choice? Family Planning, Teenage Pregnancy and STIs Rational choice of teenage sexual behaviour lead to radically different predictions than do models that assume such behaviour is random. Existing empirical evidence has not been able to distinguish conclusively between these competing models. Using regional data from England between 1998 and 2001, I find that recent increases in availability of youth family planning clinics are associated with increases in teenage STI rates, but are not associated with changes in pregnancy rates for most age groups. I further find that the adverse impact on STI rates has increased significantly since emergency birth control has become more widely available. The observed relationships are largely consistent with economic models of rational choice and inconsistent with models in which teenage sexual behaviour is assumed to be random.

The Institute of Economics suggested that the papers became Discussion Papers from the Institute. The editor of Economic Theory offered to consider the papers for a special Festschrift issue of the journal with Karl Vind as Guest Editor. This paper is one of the many papers sent to the Discussion Paper series. Most of these papers will later also be published in a special issue of Economic Theory.

Are poor people more or less likely to take money risks than wealthy folks? We find that risk attraction is more prevalent among the wealthy when the amounts of money at risk are small (not surprising, since ten dollars is a smaller amount for a wealthy person than for a poor one), but, interestingly, for the larger amounts of money at risk the fraction of the nonwealthy displaying risk attraction exceeds that of the wealthy. We also replicate our previous finding that many people display risk attraction for small money amounts, but risk aversion for large ones. We argue that preferences yielding “risk attraction for small money amounts, together with risk aversion for larger amounts, at all levels of wealth, ” while contradicting the expected utility hypothesis, may be well-defined, independently of reference points, on the choice space.

two referees for helpful comments. There are a host of potentially risky behaviors in which youth engage, which have important implications for both their well being as youth and their life prospects. Activities such as smoking, drinking, sex, and drugs are generally first encountered before individuals are 19, yet they have important ramifications for the remainder of these youth’s lives. For example, roughly one-third of high schoolers have smoked in the past 30 days, and over three-quarters of smokers start before they turn 19 years old (Gruber and Zinman, 2000). Over half of individuals first have sexual intercourse in high school, and almost 10 % have been pregnant in high school (CDC, 1998). And 80 % of high schoolers have imbibed alcoholic beverages, and 63 % of high school seniors have been drunk (University of Michigan, 1998). Moreover, the past decade has seen dramatic shifts in the intensity with which youths pursue these risky activities. The youth homicide rate fell 40 % from 1993 to 1997, and teen births declined by