A potential case of social bankruptcy: States' AFDC payments and their teen birth rates

Based on a pooled time series analysis that covers a 30-year period at five different time points - 1960, 1970, 1980, 1985, and 1990 - this research examines the relationship between states' Aid to Families with Dependent Children (AFDC) payments and teen birth rates. Drawing on rational choice theories, we expected the effects of states' AFDC payments on their teen birth rates to be positive, taking into account states' divorce rates, population change rates, unemployment rates, racial composition, and poverty rates. The effects of states' AFDC payments were significant in a negative direction in Model 1, a random effects model; they also were significant in a negative direction in Model 2 when we controlled for the effects of year; however, when we controlled for the effects of year and state in Model 3, they were not significant. The findings do not support assumptions regarding the incentive effects of welfare that underlie rational choice theories in states where teen birth rates are higher. If anything, teen birth rates are higher in states where AFDC payments are lower. Implications for policy and further research are discussed in relation to the positive effects of states' poverty and population change rates on the state teen birth rate problem.