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

We study one aspect of the link between welfare and unwed motherhood: the relationship between benefit levels and the time-to-first-marriage and time-to-next-birth among women whose first" child was born out of wedlock. We use twin births to generate effectively random variation in welfare benefits among mothers within a state, which allows us to control for unobservable characteristics of states that typically confound the relationship between welfare payments and behavior. The twins approach yields evidence that higher base levels of welfare benefits: (1) lead initially unwed white mothers to forestall their eventual marriage; and (2) lead initially unwed black mothers to hasten their next birth. The magnitudes of these effects are small, however. Moreover, we find no evidence that the incremental benefit paid upon the birth of an additional child affects fertility.

Consumer Discrimination and Self-Employment

Self-employment rates and incomes differ significantly by race. We show that these differentials arise in markets with consumer discrimination and incomplete information about the price of the good and the race of the seller. Equilibrium income distributions have two properties: mean black incomes are lower than mean white incomes, and the returns to ability are lower for black than for white sellers. Able blacks, therefore, are less likely to self-select into the self-employment sector than able whites. Using the 1980 Census data, we find that observed differences in the self-employment income distributions are consistent with the theoretical predictions.

Self-Selection and Internal Migration in the United States

Within the conceptual framework of the Roy model, this paper provides an empirical analysis of internal migration flows using data from the National Longitudinal Surveys of Youth. The theoretical approach highlights regional differences in the returns to skills: regions that pay higher returns to skills attract more skilled workers than regions that pay lower returns. Our empirical results suggest that interstate differences in the returns to skills are a major determinant of both the size and skill composition of internal migration flows. Persons whose skills are most mismatched with the reward structure offered by their current state of residence are the persons most likely to leave that state. and these persons tend to relocate in states which offer higher rewards for their particular skills.

Immigration and the Family

This paper studies the role of the family in determining the skill composition and labor market experiences of immigrants in the United States. Our theoretical framework, based on the assumption that family migration decisions maximize household income, shows that the family attenuates the selection characterizing the skills of the immigrant population. The empirical analysis uses the 1970 and 1980 Public Use Samples of the U.S. Census, and reveals that an immigrant's skills and labor market performance are greatly influenced by the composition of the household at the time of migration, and by his placement in the immigration chain.