"Culture of Despair"

This paper borrows from the tradition of other social sciences in considering the impact that “culture ” (broadly defined as the economic and social environment in which the poor live) plays in determining early, non-marital childbearing. Along with others before us, we hypothesize that the despair and hopelessness that poor, young women may face increases the likelihood that they will give birth at an early age outside of marriage. We derive a formal economic model that incorporates the perception of economic success as a key factor driving one’s decision to have an early, non-marital birth. We propose that this perception is based in part on the level of income inequality that exists in a woman’s location of residence. Using individual-level data from the United States and a number of other developed countries, we empirically investigate the role played by inequality across states in determining the early childbearing outcomes of low socioeconomic status (SES) women. We find low SES women are more likely to give birth at a young age and outside of marriage when they live in higher inequality locations, all else equal. Less frequent use of abortion is an important determinant of this behavior. We calculate that differences in the level of inequality are able to explain a sizeable share of the geographi