Interesting article by Steve Landsburg in Slate about how to calculate the opportunity costs for future income of becoming a mother. He’s reporting a study by Amalia Miller (pdf), who claims that delaying childbirth for a year in your twenties increases your prospective income by 10%. I was most interested in the method, and am even more interested in hearing what economists have to say about the method and the findings (open invitation). Landsburg on the method:
How does Miller know her findings are reliable? It would never do for her to simply compare the wages of women who gave birth at different ages. A woman who gives birth at 24 might be a different sort of person from a woman who gives birth at 25 and those differences might impact future earnings. Maybe the 24-year-old is less ambitious. Or worse yet (worse from the point of view of sorting out what’s causing what), maybe the 24-year-old started her family sooner precisely because she already saw that her career was going badly.
So, Professor Miller did something very clever. Instead of comparing random 24-year-old mothers with random 25-year-old mothers, she compared 24-year-old mothers with 25-year-old mothers who had miscarried at 24. So, she had two groups of women, all of whom made the same choices regarding pregnancy, but some of whom had their first children delayed by an act of chance.