When I dropped my daughter and her friends off at their senior prom last week I thought it would be fun to take a walk into the foyer of the building to see all the kids dressed up in their finery. I was surprised when I got there to see, among the finely coiffed girls in pretty dresses and boys looking uncomfortable in their tuxes, a large number of track-pant wearing girls slinging babies on their hips. I asked my daughter later who they were and she explained that the girls in their class with babies had come to the beginning of the prom to see their friends all dressed up for the night.
In Canada, where I live, the birth rate for teenage girls is about 14 per 1,000. Given that there are less than 200 girls in my daughter’s graduating class, statistically there should be less than 3 girls who had babies in their last year of high school. There have been many more than that and a new economics paper might have the explanation for why that has been the case. You see, the kids who attend our local high school come from two very distinct neighborhoods; an affluent well educated neighborhood and a neighborhood referred to as “the pubs”, a place where most of the residents live in public housing and many are on social assistance.
This new research finds, using U.S. data, that much of the state-by-state variations in teen pregnancy rates can be explained by income inequality. They explain that the observation that the rich are much richer than the poor creates a “culture of despair” among less advantaged teens. This culture reduces the perceived cost of child bearing among teens since those girls, probably correctly, assume they will never be able to rise above their current circumstance regardless of their child-bearing.
The evidence suggests that moving from a high income inequality state to a low income inequality state reduces the probability that a girl with low socio-economic status (defined as having a mother who did not complete high school) will have given birth by age 20 by five percentage points. Interestingly moving from a high income inequality state to a low income inequality state increases the probability of terminating a pregnancy for these same girls by 4.2%. So the main reason for differences in income inequality driving differences in birth rates is not because contraceptive use varies but rather because of abortion rates – girls in high income inequality states are not better at preventing pregnancy but are rather choosing after the fact not to give birth.
There is no effect on the birth rate of high socio-economic status girls moving from a high income inequality state to a low income inequality. This research is not yet published, but is available at the National Bureau of Economic Research. I suspect that by the time it is published though the authors will have been asked by a referee to remove the state of New York from their analysis. New York State is an outlier in that it has both a very low birth rate and a very high fertility rate – many more girls are getting pregnant in NY but many are choosing to terminate those pregnancies. It also has, by some measures, the highest level of income inequality among all the US states. I suspect that removing NY though will only strengthen the results of this paper.
One more thing, I really think that part of the effect here comes from the cost of a post-secondary education. If college is inexpensive then even girls from poor families might one day dream of having a college degree. If it is costly, though, then it will be out of the reach of most low income girls, so having a baby in high school won’t affect their probability of going to college (which is already close to zero). Access to post-secondary education also affects income inequality. I suspect that it is this access to education that explains why the child-bearing rate of US teens is three times higher than that of Canadian teens (40 per 1,000 in the US rather than 14 per 1,000 in Canada).
One of my daughter’s friends who I drove to the prom last week was born to an unmarried teen mom who went on to become an engineer so I don’t feel so much despair for the girls that came to see their friends walk the prom red carpet. I suspect what is missing though is someone in their lives to tell them that they have options. This is why it is the culture in which they live that is really to blame for their predicament more than the income inequality. The problem with all these discussions though is that it is difficult to determine which came first – the culture or the inequality.
* Schettini Kearney, Melissa and Phillip B. Levine (2011). “Early Non-Marital Childbearing and the “Culture of Despair”” NBER Working Paper 17157 http://www.nber.org/papers/w17157