Kids and Costs: A Guest Post on Twins by Bryan Caplan

Bryan Caplan, a professor of economics at George Mason University and a blogger for EconLog, is the author of a new book called “Selfish Reasons to Have More Kids: Why Being a Great Parent Is Less Work and More Fun Than You Think.”  He’s guest-blogging for us about parenting.  You’ll  be hearing more from Caplan in these environs soon, as he’ll be one of the guests in an upcoming Freakonomics Radio show tentatively titled “An Economist’s Guide to Parenting.”

Kids and Costs
By Bryan Caplan

One day when my wife and I were strolling our twin infants, we overheard a passing jogger tell her friend, “Now there’s a reason to shoot yourself.” Econ 101 suggests that she had a point. Economists usually assume that doubling output more than doubles costs; or as textbooks say, there are increasing marginal costs. So economists naturally expect twins to be more than double the effort, stress, and out-of-pocket cost of a singleton. As Joshua Gans of Parentonomics writes: “But regardless of the level of the cost curve for parenting, it is surely the case that the marginal costs of parenting for each additional child are increasing.”

Econ 101 was brutally accurate for the first three months of our twins’ lives. I was in charge of midnight feedings, and repeatedly faced an ugly dilemma: What do you do if one twin wakes up for food while you’re feeding his brother? Either way, you have a baby in tears.  But as our twins grew up, Econ 101 gradually drifted away from the facts, for three main reasons.

First, after infancy, most of the cost of parenting is fixed. People with one child live very different lives than people with zero children: Parents move to the suburbs, rarely travel, and stay home Saturday nights. But once you make these sacrifices, an extra child has little additional effect on your lifestyle. Maybe that’s why almost all of the negative effect of kids on parental happiness in the General Social Survey comes from kid No. 1.

Second, doubling your kids definitely less than doubles the financial cost of raising them. Hand-me-downs and nannies are the most obvious examples. But the deeper reason is that parents learn by doing. Once you discover the Ferber method for making babies sleep through the night, you can use it over and over.

Photo: iStockphoto

Third, as long as your kids play well together, more kids can actually be less work. Now that they’re eight, I’m convinced that our two twins demand less attention than one singleton. Why? Because each twin has a built-in playmate. We don’t have to entertain them much because they entertain each other.

Ultimately, Econ 101 does have the last word: If you keep having kids, you’ll eventually reach the point of increasing marginal costs. That’s good to know. But it’s at least as important to realize that your second, third, or fourth kid won’t cost as much as your first — and might even make your life easier.

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  1. Nate says:

    I’m a twin and definitely appreciate this article.

    One cost you didn’t mention that you might want to consider – education. It seems like your article only applies to children before they reach their schooling years.

    Any parents paying for private primary schools and college might disagree with your position.

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  2. iamreddave says:

    My mother in law had undiagnosed identical twins. There was little ultrasound in 1982 Ireland. After the first was born the midwife asked her if “she wanted the good news or the bad news” the second twin was both.

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  3. Jessica says:

    The statement that Economists usually assume more than double costs for double output seems suspect. I can think of many instances where start up costs associated with an activity (such as construction) make the first increment substantially more expensive than the second, third, fourth…

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    • Ryan says:

      The argument is that *at some point* along the costs curve you will reach a point where marginal costs are increasing. Before that point, marginal costs can decrease as returns to scale are realized. By arguing that usually doubling production more than doubling costs, economists assume that decreasing marginal costs have been taken advantage of – if the additional cost of building a second house at the same time as the first is lower than building two houses sequentially, a construction company will generally build two at the same time. But even if the second house is cheaper, it does not mean that building a third, fourth, etc will be cheaper; by doubling output from two to four at the same time, the construction company *may* more than double costs and at some point doubling production again *must* lead to a more than doubling of costs.

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  4. A.S. says:

    I agree, with Nate: as kids grow up the variable costs tend to increase compared to variable costs: education, entertainment, sports, etc. Even house size, especially if you start from a small apartment. Especially if you have opposite gender siblings.
    Also time is not a fixed cost, especially for dual-earner families: it will be not all that common that siblings will get sick at the same time or do all the same activities, hence parents will have to take more time to accomodate for the extra child(ren)

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  5. Risa says:

    I had (undiagnosed) fraternal twins in 1982. For one thing after 6 onths they were never the same size so what I bought in the larger size eventually fit the smaller of the two. Also I bought better stuff for my older kids since there was good use for it. In terms of effort, having kids who can play together is definitely an advantage in terms of keeping them busy say on trips. I don’t think there is much advantage though in saving costs on feeding them or education. But, if that is your reason for or against having kids you should wait till you have a better reason.

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  6. VB in NV says:

    Perhaps the jogger’s comment was directed at your wife’s plight of being married to an economist.

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  7. Eric M. Jones says:

    And each First-World child has a million kilogram CO2 footprint.

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  8. SE says:

    The elephant in the room here is education – basically, the thesis is premised upon the state paying for education via general taxation.

    Here in the UK, for counter-example, the cost of a good (ie. private) education so dwarfs ANYTHING else, that the marginal costs of additional children are… well… I can’t put an exact figure on it, but I’d say it is a LOT closer to 100% than it is to 50%!

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