Measuring the cost of children

Area of Science:

• Economics
• Family Economics
• Social Policy Analysis

Background:

• Estimating the economic costs of raising children is crucial for social policy development.
• Cross-sectional household expenditure data provides a basis for these economic models.
• The relevance of child costs for social policy has been debated.

Purpose of the Study:

• To survey and synthesize economic models for estimating marginal child costs.
• To evaluate the argument against considering child costs in social policy.
• To compare different economic models using Australian household expenditure data.

Main Methods:

• Review and synthesis of existing economic models.
• Analysis of the social policy relevance of child costs.
• Estimation of an Engel curve system using 1988-89 Australian Household Expenditure Survey data.

Main Results:

• Identified and synthesized various economic models for child cost estimation.
• Contested and rejected the notion that child costs are irrelevant to social policy.
• Compared model performance using empirical Australian household expenditure data.

Conclusions:

• Economic models provide valuable estimates of marginal child costs.
• Child costs are a significant consideration for social policy.
• Further research and improved data collection strategies are needed.