Discussion paper

DP17722 Parenthood in Poverty

Parenthood could change economic and psycho-social trajectories profoundly, creating opportunities in some domains of life and strain in others. Individuals of low SES, who might lack resources to weather the disruptions caused by parenthood, may face distinct challenges, detailed knowledge of which would greatly aid better design of social assistance. We provide comprehensive evidence of the effects of new parenthood on key markers of economic and psycho-social well-being among women of low SES in the U.S. Using longitudinal, high frequency administrative records from a large urban county in combination with an event study design, we find that new parenthood leads to: i) short-term and long-term changes in the housing environment, including increases in short-term homeless-shelter stays, transition into longer-term homelessness programs, and transition into public housing; ii) an increase in treatment for opioid use disorder likely driven by those with a pre-existing, formerly untreated disorder; iii) large eligibility-rule driven increases in use of key government assistance programs for healthcare, food assistance, and cash assistance; iv) large reductions in criminal behavior, unlikely to be driven by increased access to government assistance. Effects are heterogeneous by race and vulnerability to mental health disorders. Robustness checks, including two separate (matched) difference-in-difference analyses, suggest robustness to endogeneity in the timing of first parenthood.

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Citation

Eichmeyer, S and C Kent (eds) (2022), “DP17722 Parenthood in Poverty”, CEPR Press Discussion Paper No. 17722. https://cepr.org/publications/dp17722