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June 20, 2011

The Economic Consequence of Fatherhood

Fathers’ Day provides a good excuse to abstain from yard work, perhaps catch a few fish, and reflect a bit on the economic consequence of fathers.  This might seem a tall order, so I begin by examining the counterfactual.  A way to do this is to evaluate families with missing fathers.

When I was a boy in the 1960s, about 8 percent of children lived in households without a father.  In 1960 about 250,000 kids had been left fatherless from the Second World War and Korea.  The early death of fathers from disease and workplace accidents likewise accounted for many missing dads.  Still, untimely death accounted for well under one in 20 of all fatherless households.  Today more than a quarter of all children live in households without fathers present.  War, disease and workplace accidents account for less than 1 percent of these.  Divorce accounts for about 45 percent of households without dads, while more than a third of women with kids never married. The economic consequences of this are huge, and fall disproportionately on kids. 

To begin the economics it is important to acknowledge that not having a father at home is not the same thing as not having a father. We all know families who share custody and support, leaving their kids to thrive.  My own grandfather succumbed to the effects of gassing in WWI, leaving four boys aged 5 to 14, my dad the youngest.  They flourished, thanks to a strong and loving mother and goodly neighbors.

That said, poverty in America is overwhelmingly caused by two things: failing to graduate from high school and single parenting.  For women these two often go together.  The numbers are startling.  By age 18, more than 4 out of 5 children of single parents spend at least one year in poverty.  Only about one in 7 children of married couples spend time in poverty by age 18.

The data for persistent poverty is even starker.  Poverty is a very transient condition for families with married couples.  Virtually all families in long term poverty – five years or more – are led by single parents.  The never-married crowd and especially teenage mothers dominate this group.

Poverty in America is not the result of an economic system. That would make it an easy fix.  The problem is far deeper and neither political party offers anything thoughtful on the matter.   My friends on the right offer a social agenda that does nothing to prevent unwed births or keep families together.  My friends on the left offer a dose of more failed government policies.  It is a largely wasted debate.

Fathers matter a great deal to the economic success of a family.  That is a good lesson for the day, but fathers matter more in more important things as well.  The probability that a teenager will become an unwed parent rises when there is not a father present to offer love and guidance on the subject.  That is a good message to impart while fishing today.

Link to this commentary: https://commentaries.cberdata.org/574/the-economic-consequence-of-fatherhood

Tags: inequality and poverty, economics, family and households


About the Author

Michael Hicks cberdirector@bsu.edu

Michael J. Hicks, PhD, is the director of the Center for Business and Economic Research and the George and Frances Ball distinguished professor of economics in the Miller College of Business at Ball State University. Hicks earned doctoral and master’s degrees in economics from the University of Tennessee and a bachelor’s degree in economics from Virginia Military Institute. He has authored two books and more than 60 scholarly works focusing on state and local public policy, including tax and expenditure policy and the impact of Wal-Mart on local economies.

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