March 22, 2012

'The Economic Boost of Childbearing'

"When American parents take on the burden of bearing and rearing a child, they deliver a huge dividend to society," Bryce J. Christensen and Robert W. Patterson write.
So concludes a team of economists from Berkeley and Syracuse universities intent on assessing "the net fiscal externality to being a parent."

Through careful economic accounting, the researchers assess, on the one hand, the costs a couple incurs as a consequence of becoming parents and the costs society at large incurs through their parenthood and, on the other hand, the economic benefits realized by the couple and by society because of their parenthood. These complex calculations yield the researchers' "central finding"—namely, that each child parents raise constitutes a net benefit to society amounting to $217,000 in 2009 dollars. In the rather opaque language of economics, "the net fiscal externality of becoming a parent is [thus] positive and substantial." Elaborating on this finding, in the same almost impenetrable jargon, the researchers assert: "Becoming a parent is tantamount to providing society with a non-depreciating capital asset that generates an annual flow of revenues, in perpetuity, such that the present value of the asset (at an interest rate of 3 percent) is $217,000." Clearly, there are "substantial public benefits to childbearing."

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