The Effect of Welfare Payments on the Marriage and Fertility Behavior of Unwed Mothers : Results from a Twins Experiment

We study the relationship between welfare benefits and the time to first marriage and time to next birth among initially unwed mothers. We use twin births to generate random within-state variation in benefits, effectively controlling for unobservables that may confound the relationship between welfare payments and behavior. Higher base welfare benefits (1) lead unwed white mothers to forestall their eventual marriage, and (2) lead unwed black mothers to hasten their next birth. The magnitudes of these effects are fairly modest. Moreover, we find no evidence that the marginal benefit paid at the birth of an additional child - the focus of the family cap debate - affects fertility