The economic costs of childhood poverty in the United States

Harry J Holzer, Diane Whitmore Schanzenbach, Greg J. Duncan

Research output: Contribution to journalArticle

Abstract

This paper attempts to estimate the aggregate annual costs of child poverty to the US economy. It begins with a review of rigorous research studies that estimate the statistical association between children growing up in poverty and their earnings, propensity to commit crime, and quality of health later in life. We also review estimates of the costs that crime and poor health impose on the economy. Then we aggregate all of these average costs per poor child across the total number of children growing up in poverty in the United States to obtain our estimate of the aggregate costs of the conditions associated with childhood poverty to the US economy. Our results suggest that these costs total about $500 billion per year, or the equivalent of nearly 4% of gross domestic product (GDP). More specifically, we estimate that childhood poverty each year: (1) reduces productivity and economic output by an amount equal to 1.3% of GDP, (2) raises the costs of crime by 1.3% of GDP, and (3) raises health expenditures and reduces the value of health by 1.2% of GDP.
Original languageEnglish (US)
Pages (from-to)41-61
Number of pages21
JournalJournal of Children and Poverty
Volume14
Issue number1
StatePublished - 2008

Fingerprint

poverty
childhood
gross domestic product
Gross Domestic Product
crime
costs
economics
cost
offense
health
economy
health expenditure
number of children
expenditures
productivity

Cite this

@article{70bc686ec50c4dd6afaf5eb0fbc1649b,
title = "The economic costs of childhood poverty in the United States",
abstract = "This paper attempts to estimate the aggregate annual costs of child poverty to the US economy. It begins with a review of rigorous research studies that estimate the statistical association between children growing up in poverty and their earnings, propensity to commit crime, and quality of health later in life. We also review estimates of the costs that crime and poor health impose on the economy. Then we aggregate all of these average costs per poor child across the total number of children growing up in poverty in the United States to obtain our estimate of the aggregate costs of the conditions associated with childhood poverty to the US economy. Our results suggest that these costs total about $500 billion per year, or the equivalent of nearly 4{\%} of gross domestic product (GDP). More specifically, we estimate that childhood poverty each year: (1) reduces productivity and economic output by an amount equal to 1.3{\%} of GDP, (2) raises the costs of crime by 1.3{\%} of GDP, and (3) raises health expenditures and reduces the value of health by 1.2{\%} of GDP.",
author = "Holzer, {Harry J} and Schanzenbach, {Diane Whitmore} and Duncan, {Greg J.}",
year = "2008",
language = "English (US)",
volume = "14",
pages = "41--61",
journal = "Journal of Children and Poverty",
issn = "1079-6126",
publisher = "Routledge",
number = "1",

}

The economic costs of childhood poverty in the United States. / Holzer, Harry J; Schanzenbach, Diane Whitmore; Duncan, Greg J.

In: Journal of Children and Poverty, Vol. 14, No. 1, 2008, p. 41-61.

Research output: Contribution to journalArticle

TY - JOUR

T1 - The economic costs of childhood poverty in the United States

AU - Holzer, Harry J

AU - Schanzenbach, Diane Whitmore

AU - Duncan, Greg J.

PY - 2008

Y1 - 2008

N2 - This paper attempts to estimate the aggregate annual costs of child poverty to the US economy. It begins with a review of rigorous research studies that estimate the statistical association between children growing up in poverty and their earnings, propensity to commit crime, and quality of health later in life. We also review estimates of the costs that crime and poor health impose on the economy. Then we aggregate all of these average costs per poor child across the total number of children growing up in poverty in the United States to obtain our estimate of the aggregate costs of the conditions associated with childhood poverty to the US economy. Our results suggest that these costs total about $500 billion per year, or the equivalent of nearly 4% of gross domestic product (GDP). More specifically, we estimate that childhood poverty each year: (1) reduces productivity and economic output by an amount equal to 1.3% of GDP, (2) raises the costs of crime by 1.3% of GDP, and (3) raises health expenditures and reduces the value of health by 1.2% of GDP.

AB - This paper attempts to estimate the aggregate annual costs of child poverty to the US economy. It begins with a review of rigorous research studies that estimate the statistical association between children growing up in poverty and their earnings, propensity to commit crime, and quality of health later in life. We also review estimates of the costs that crime and poor health impose on the economy. Then we aggregate all of these average costs per poor child across the total number of children growing up in poverty in the United States to obtain our estimate of the aggregate costs of the conditions associated with childhood poverty to the US economy. Our results suggest that these costs total about $500 billion per year, or the equivalent of nearly 4% of gross domestic product (GDP). More specifically, we estimate that childhood poverty each year: (1) reduces productivity and economic output by an amount equal to 1.3% of GDP, (2) raises the costs of crime by 1.3% of GDP, and (3) raises health expenditures and reduces the value of health by 1.2% of GDP.

M3 - Article

VL - 14

SP - 41

EP - 61

JO - Journal of Children and Poverty

JF - Journal of Children and Poverty

SN - 1079-6126

IS - 1

ER -