Sunday, October 07, 2007

Sunday dollars+sense: So you think having children will make you happy? Stick to one.

Last week when I discussed the financial cost of having a second child I might have scared you in a way I should not.

That cost amounts to the best part of $400,000 according to a doubtless accurate calculation prepared to assist the couple suing a Canberra in vitro fertilisation specialist for the wrongful birth of one of their twins.

That calculation added up the cost of everything extra that parents need to spend as a result of having a second child - extra toothpaste, extra refrigerator space, and so on 700 times.

The operative word is “need”.

It wasn’t a measure of what parents actually spend.

Actual spending turns out to be almost totally dependent on income...

That is to say, the more money parents have, the more they will spend on their children -sometimes way in excess of need – almost without limit. Conversely, if parents don’t have much money, they won’t spend much - regardless of need. Low income people have children all the time.

This line of thinking suggests that the extra financial cost of the extra child to the couple in question will probably be close to zero, rather than $400,000. Two children could hardly use up more of their cash than one.

I don’t envy the judge.

But I am able to offer something else that might help.

An extra child typically makes the mother less happy. Yes, less happy.

It has long been observed that people with children are happier than people without. But until 2005 it was hard to be sure what caused what. Did having the children make those people happy, or did they have children in part because they were happy?

A Danish study of 35,000 identical twins has answered the question. Among people equally genetically disposed to happiness, having a first child matters a lot. It makes the mother an astonishing 20 per cent happier than her childless identical twin.

But having a second child sends her happiness backwards - yes, backwards - by around 13 per cent. A third child leaves her no happier than a childless identical twin.

For fathers it’s different, and I’ll explain why next time.

But if I were working for the mothers in the Canberra court case, I would be presenting the judge with the results of happiness research as well as largely meaningless calculations about the financial cost of having a second child.

Kohler, Hans-Peter; Behrman, JereR.; Skytthe, Axel Partner + Children = Happiness? The Effects of Partnerships and Fertility on Well-Being, Population and Development Review, Volume 31, Number 3, September 2005 , pp. 407-445(39)

Hat tip: Marginal Revolution.