Workshop for helpful comments.

Never-married motherhood is associated with worse educational outcomes for children. But this association may reflect other factors that also determine family structure, rather than causal effects. We use incarceration rates for men as an instrumental variable in estimating the effect of never-married motherhood on high school dropout of black and Hispanic children. We find that unobserved factors drive the negative relationship between never-married motherhood and child outcomes, at least for children of women whose marriage decisions are affected by incarceration of men. For Hispanics we find evidence that these children may actually be better off living with a never-married mother.