Abstract

Building on recent work by Rosenzweig (1999), this paper re-examines the effect of AFDC benefits on early non-marital childbearing. Unlike most previous work in this area, Rosenzweig finds a statistically significant and quantitatively large positive effect of AFDC benefits. Using data from the Panel Study of Income Dynamics, we replicate Rosenzweig’s analysis and explore the reasons his findings differ from earlier research findings. We are able to reproduce his main finding that AFDC generosity influences non-marital childbearing when state and cohort fixed-effects are included. However, we find that model specification matters a great deal. An alternative specification of state fixed-effects yields no evidence of an AFDC effect, and when we focus on fertility only through age 19 (as in prior work), we also find no AFDC effect. This latter finding implies that the behavior of women in their early 20s may be far more sensitive to welfare In this paper, we replicate and extend recent research by Mark Rosenzweig (1999) on the relationship between AFDC benefits and non-marital childbearing by young women. Most previous work on the effects of AFDC benefit levels on a wide range of demographic behaviors, including non-marital childbearing, has found a relatively weak relationship. In some papers, benefits do have a statistically significant effect that is

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