The Price of Virtue

Abstract:     
This Article offers new evidence on the determinants of U.S. unwed birth rates from 1975 to 1990. We show that higher illegitimacy rates are positively and significantly correlated with payments under the Aid to Families with Dependent Children program. Our results are also consistent with explanations which attribute the increase in illegitimacy to a decline in community-based social sanctions, which form part of a state's social capital.

JEL Classification: H7, I38

working papers series