What Did the "Illegitimacy Bonus" Reward?

54 Pages Posted: 10 Sep 2004 Last revised: 27 Sep 2010

See all articles by Sanders Korenman

Sanders Korenman

City University of New York - School of Public Affairs; National Bureau of Economic Research (NBER)

Theodore Joyce

CUNY Baruch College - Zicklin School of Business; National Bureau of Economic Research (NBER)

Robert Kaestner

University of Chicago; National Bureau of Economic Research (NBER)

Jennifer Walper

Baruch College, CUNY - School of Public Affairs

Date Written: August 2004

Abstract

The 'Illegitimacy Bonus,' part of 1996 welfare reform legislation, awarded $100 million in each of five years to the five states with the greatest reduction in the nonmarital birth ratio. Three states -- Alabama, Michigan, and Washington DC -- won bonuses four or more times each, claiming nearly 60% of award monies. However, in none of these three states was the decline in the nonmarital birth ratio linked to increases in proportions married, and only in Michigan was it linked to declines in nonmarital (relative to marital) fertility within demographic groups, behavioral changes that the Illegitimacy Bonus was presumably intended to reward. Shifts in the racial composition of births accounted for 1/3 (Michigan), 2/3 (DC) or all (Alabama) of the decline in the nonmarital birth ratio. The non-marital birth ratio fell most in DC, averaging 1.5 percentage points per year over the award period. However, the number of black children born in DC fell by nearly one half from 1991 to 2001. Changes in population composition alone primarily a decline in the number of black women aged 15 to 34 can account for the entire decline in the nonmarital birth ratio in DC between 1990 and 2000.

Suggested Citation

Korenman, Sanders and Joyce, Theodore J. and Kaestner, Robert and Walper, Jennifer, What Did the "Illegitimacy Bonus" Reward? (August 2004). NBER Working Paper No. w10699, Available at SSRN: https://ssrn.com/abstract=583423

Sanders Korenman (Contact Author)

City University of New York - School of Public Affairs ( email )

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Theodore J. Joyce

CUNY Baruch College - Zicklin School of Business ( email )

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National Bureau of Economic Research (NBER) ( email )

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Robert Kaestner

University of Chicago ( email )

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National Bureau of Economic Research (NBER)

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Jennifer Walper

Baruch College, CUNY - School of Public Affairs ( email )

135 E 22nd St
New York, NY 10010
United States

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