What, exactly, is the benefit to society of a generation being raised by parents who have been pressured, guilted, or bullied ino parenting?

I don’t think there would be any benefit and I never advocated doing anything like that. I merely pointed out that (1) society needs children (2) people who do not raise children share in the same economic rewards as parents (3) people who choose to become parents must assume a huge burden and that the free-market does nothing to alleviate this burden.

They may not teach this at Harvard but the first step in understanding someone’s argument is to read what they actually wrote and not to slap your own stereotype based interpretation onto it.

Guess Chicago boys can

I’m not familiar with the world where a typical person is going to bust his butt to help J. Random Stranger out of a financial jam as readily as he will do so for Mommy and Daddy. What color is the sky there?

Ex: We only need one person in a thousand to understand how to produce electricity for us to all go about our daily business. What happens when only one in 10 million understand? (Social dislocation, foreign dependence, market disruptions I imagine.) You’re right that this is the general trend.

It also occurs to me in these posts that you don’t give much credence to the independent spirit. I think, even as a geezer, I can take care of me and mine – often in cooperation with others of similar independence. As a practical matter I think you overestimate the “need” for economic benefit derived from “new blood” especially in the doghoouse social reality of this county, now.

Your question really is “how to reverse the trend?” isn’t it? IMO, a bird-flu/black plague like epedemic, or maybe mideast-like conflagration gone out of control offer the most likely way this will get changed. You may be more optimistic than I, however, so post on.

Simply put, there will be more resources available from an economic standpoint when there are fewer people to consume them

This is incorrect. ALL resources exist because of human action. The ONLY natural resource is the human mind. The more people the more resources.

Those of us that do not supply children contribute in numerous other ways to the economy.

Yes you do but you also will benefit enormously from time and money that parents invest in their children when those children grow up to be net producers. More importantly for the free-rider problem, any individual will receive the same level of economic benefit from the next generation as parents even though you will pay substantially less.

I am not saying that government and even private subsidies do not reduce the cost of having children but they do make it anywhere near a break even proposition compared to the alternative.

Remember, children are not the goal. A child is merely the production phase of the productive adult. Right now we have no market mechanism for insuring that enough future adults will exist and socialized subsidies are a mixed blessing at best.

Each year the desirable number of new babies could be determined, based on the replacement rate. I’ll use 3 million babies per year as an example. Parents would submit bids based on what they would like to get paid and whatever the market clearing price is, all parents are paid that amount. So, say if the 3 millionth set of parents submits a price of $110,000 all parents would receive that amount. The economics behind using the marginal price as opposed to paying each persons bid amount is found in many auctions, such as electricity spot markets (which I’m most familiar with).

This would capture the differing non-economic/monetary value that people put into having children as those who derive a higher non-monetary value would presumably submit a lower bid, and those who are only reproducing for the money would submit a bid close to what they think would be their total costs plus a rate of return.

I’d say the low-income childrearing costs are a good baseline

Well, remember that what I am actually interested in is the productivity of the adult as a child. The REAL cost analysis that I would like to see would be one that matches the cost of raising a child into an adult and that adults income.

I would bet that middle-class families provide a better rate of return poor families.

First of the report clearly states the “USDA uses the per capita method to allocate expenses
on housing, transportation, and miscellaneous
goods and services in equal proportions among household members.”

Secondly, one could argue that some child specific costs they measure such as daycare tuition do provide measurable economic/monetary benefit to the parents. This is a big topic of debate here in Canada where some political parties want to implement national institutionalized day care whereas another party wants to provide a flat per child payment and allow parents to decide how to spend that money.

You make a valid point. The USDA figures I referenced are supposed to largely concerned with basic necessities of food, clothing, shelter etc. but I don’t know the details. On the flip side, the time that parents spend is also not accounted for anywhere.

From the purely economic perspective, a good way to think of the problem would be to ask, “How much would it cost to contract somebody to raise up a child into a middle-class productive adult?” I think the cost would be considerable to say the least.

Monetary costs associated with feeding, clothing and providing shelter do increase the economic potential of a child to the extent that it keeps them alive. However, a discussion on the free rider effect should only address costs related to the provision of a bare minimum of these essentials. I’d argue that buying your kids designer clothes, eating out a fancy restaurants and living in posh neighbourhoods largely improves the quality of childrens lives and by extension the non-economic value derived by their parents who should bear all of those costs.

In the next breath you state
“What really amazes me is that so many of the childless are so blind to their own enlightened self-interest. You are going to need the labor of today’s child as tomorrow’s adult. ”

So which is it, do we derive economic benefit or not?

Are you so arrogant to think that “Freeriders” cannot see the “enlightened self interest”.

I think you oversimplify the issue and therefore will never come to a correct statement of the problem, which means that you will never be able to solve the problem.

Much like economists oversimplify market dynamics by placing them in a “rational markets” paradigm, forever damning themselves to ltcm like blow outs.

The free rider dynamic cannot swamp all other variables or the human race would have died out. It is a cycle of ever changing leaders, dynamic societal forces presses on different populations, forcing them to become more efficient, then as thier efficiencies create abundance they become more lax, and lose thier margin of efficiency which created the abundance and the cycle repeats.

I do not think it is a zero sum cycle though, each cycle builds on a foundation created by the previous and so various societies advance through history.

I find your arrogance in putting forth your thesis offensive, in that it assumes that you can measure so many variables you most surely cannot.

And yet the empirical evidence supports my thesis. As the economic return of children decreased to near zero and the cost of rearing children climbs, people choose to have fewer children. This is exactly what any one with even a basic understanding of market forces would expect to happen.

I have never asserted that non-economic forces do not play a role in peoples decisions. In fact, had you read carefully, you have seen that I assert that non-economic forces are the only reason that people continue to rear children! This is what creates the free-rider problem in the first place.

My thesis isn’t “arrogant” at all. I don’t have to measure all the variables, I merely need to measure the controlling variables and this I have done. The existence of the free-rider dynamic will eventually swamp all other considerations so I can ignore them. If you have a counter-example, I would love to see it.

What really amazes me is that so many of the childless are so blind to their own enlightened self-interest. You are going to need the labor of today’s child as tomorrow’s adult. Why would you bet you own future on the idea that others will make huge economic sacrifices to make it so?

Whatever else this topic as churned up, it has certainly churned up the most prevalent failing of economics as a science, the variable of human emotion in the mathmatical equation.

Markets are not rational and people’s decisions regarding child rearing are not rational. They are weighted with ignorance and bias and enthusiasms unrestrained.

And so I do not find your thesis offensive in and of itself, I find your arrogance in putting forth your thesis offensive, in that it assumes that you can measure so many variables you most surely cannot.

Your science would be served greatly by humble toil, as would many others.

See Bush’s sane and modest SS reform: We won’t be holding our breath for eliminations of creaky systems any time soon.

The primary reasons I have chosen so far not to have children are because I am currently renting while I wait for the housing market to return to a realistic price level (a cost of currency debasement) and that I will not have kids until I know I will not have to put them through the school system. That means I have to figure out what it takes in the state of California to home school. Even then there are still risks that the laws will change and CA will become like NY and take my kids away from me because I don’t properly indoctrinate them into statism. If it weren’t for those factors, I’d have ten kids already. Well, maybe just three or four.

Exactly.

But that’s not reductio ad absurdium; that’s just what a free rider problem IS. It’s any circumstance in which there’s incentive to avoid bearing particular costs even though you can still reap the benefits.

The museum I work at has free nights. This results in a “free rider problem”. It just so happens that this particular free rider problem has been intentionally created because we *want* people to share in the benefits of the museum.

Despite your continued attempts to discard the child-bearing free rider problem, it’s still there. That doesn’t necessarily mean anything should be done about it; it only means that there’s a situation in which people have an incentive NOT to bear the costs of raising children while still sharing in the benefits from others having raised children.

Shannon thinks the problem is significant enough that we might be nearing the time to change public policy (by eliminating socialist programs) so that the next generation doesn’t shrink too much compared to this one. I’m not convinced, in large part because I expect the country to continue to import labor. I think we need to eliminate socialist programs because they’re STUPID, but I don’t think the effect on childbearing is significant enough to worry about at present.

Indeed. That’s what I was alluding to when I compared Shannon’s protestations that “free rider” was not at all pejorative with Ray Nagin’s protestations that “chocolate city” was not at all racist. Everything I’ve seen since then simply confirms that initial impression.

“Breeder is at least getting some kids for all his expenses”

This is the fundamental reason why “free rider” analysis is simply inapplicable to this situation — the kids are the *parents’* kids, not a communal resource. If parents had to pay for the maintenance of children while they lived in some Spartan barracks under communal control, the situation *would* be a free rider problem (only certain people have to pay, but everybody gets the same reward).

(As I noted earlier, Shannon’s attempt to separate monetary and non-monetary rewards and ignore the latter leads to a reductio ad absurdum in which all sorts of ordinary things become “free rider problems”. For example, most cultural expression would die off if only people who were confident of turning a profit created art and literature.)