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THE LABOR SUPPLY OF SINGLE MOTHERS

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regression results below) is that single women without children are not a good comparison group for single mothers. The means in Appendix 2 suggest the possibility that changes in the character- istics of single mothers versus single women without children could explain the two groups’ differing employment rate trends. In our regression results we condition on observable characteris- tics, such as race and education, in order to make the two groups more comparable. It is also interesting to note that single women with and without children are quite similar in an important dimension: hourly earnings. The mean hourly earnings of women with and without children are fairly similar (and they are much closer if one controls for education).

Perhaps more importantly, one might argue that employ- ment rates are so high for single women without children that it is unreasonable to expect this group to respond to changes in economic conditions in the same way that single mothers do. Yet, employment rates are not particularly high for low-educated sin- gle women, particularly when examining employment last week. Only 33 percent of high school dropout single mothers worked, and 48 percent of high school dropout single women without children worked last week. Nevertheless, in our later regressions, derivative estimates for our key policy variables tend to be the largest and most statistically signicant for high school dropouts.

One might also wonder whether the large increases in em- ployment that we nd for single mothers, but not for single women without children, also occur for other demographic groups. In Meyer and Rosenbaum [2000a] we examine whether there are similar employment increases for two other groups with historically low employment rates: black males 19 – 44 and mar- ried mothers 19 – 44. We nd that the large increases in employ- ment of single mothers over 1984 –1996 and particularly since 1991–1996 are not mirrored by other demographic groups.

Another potential criticism of our approach is that using variation across women in their marital status, number of chil- dren, and state of residence, implicitly assumes that marriage, fertility, and migration decisions are exogenous to the policy changes that we examine. The evidence on the effects of policy changes on these decisions is mixed, making the exogeneity as- sumption more plausible. For example, in her recent review Hoynes [1997] concludes: “Together this evidence suggests that marriage decisions are not sensitive to nancial incentives.” She also argues that: “Overall [the effects of welfare on out-of-wedlock

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