Games Daughters and Parents Play: Teenage Childbearing, Parental Reputation, and Strategic Transfers

58 Pages Posted: 16 May 2000 Last revised: 18 Jun 2022

See all articles by Lingxin Hao

Lingxin Hao

Johns Hopkins University

V. Joseph Hotz

Duke University; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Ginger Zhe Jin

University of Maryland - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: April 2000

Abstract

In this paper, we examine the empirical implications of reputation formation using a game-theoretic model of intra-familial interactions. We consider parental reputation in repeated two-stage games in which daughters' decision to have a child as a teenager and the willingness of parents to continue to house and support their daughters given their decisions. Drawing on the work of Milgrom and Roberts (1982) and Kreps and Wilson (1982) on reputation in repeated games, we show that parents have, under certain conditions, the incentive to penalize teenage (and typically out-of-wedlock) childbearing of older daughters, in order to get the younger daughters to avoid teenage childbearing. The two key empirical implications of this model is that the likelihood of teenage childbearing and parental transfers to a daughter who had a teen birth will decrease with the number of the daughter's sisters at risk. We test these two implications, using data from the National Longitudinal Survey of Youth, 1979 Cohort (NLSY79), exploiting the availability of repeated observations on young women (daughters) and of observations on multiple daughters (sisters) available in this data. Controlling for daughter- and family-specific fixed effects, we find evidence of differential parental financial transfer responses to teenage childbearing by the number of the daughter's sisters and brothers at risk.

Suggested Citation

Hao, Lingxin and Hotz, V. Joseph and Jin, Ginger Zhe, Games Daughters and Parents Play: Teenage Childbearing, Parental Reputation, and Strategic Transfers (April 2000). NBER Working Paper No. w7670, Available at SSRN: https://ssrn.com/abstract=228144

Lingxin Hao (Contact Author)

Johns Hopkins University ( email )

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V. Joseph Hotz

Duke University ( email )

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Ginger Zhe Jin

University of Maryland - Department of Economics ( email )

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National Bureau of Economic Research (NBER)

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