Wednesday, March 11, 2009

Oz Study on Cost of Raising Children

Child costs 'only $1300 a year'
Dr Dockery said if children were a "cost", parents would end up less wealthy than comparable couples without children. But his study, based on 3168 married couples, found this was not the case.

When the net wealth of the parents and the child-free in 2002 was compared - housing, shares, superannuation and savings - the parents were only marginally worse off, suggesting a child cost $1300 a year. When wealth accumulation between 2002 and 2006 was considered, couples with children were a little better off.

Dr Dockery said couples with children were more likely to be home owners and to have a bigger house.

Previous Australian studies have shown that a typical family will spend $537,000 on raising two children from birth to 21. Dr Dockery claims the cost is more like $55,000.
I don't even know where to begin with this one. The logic is all over the place, and at times non-existent. To begin with, he compares parents and child-free, and reasons that because parents are homeowners, the decision to have children does not leave one worse off financially. He does not consider the strong possibility that the group of people with children includes those who began worse-off, and decided not to have children, making the populations he is comparing completely disparate in the first place.
Dr Dockery disputes the logic of seeing children as a cost. The price people were prepared to pay for fertility treatments showed children were regarded as a "very large net benefit".

He also takes issue with previous studies that used the amount of money parents spend on children to determine their cost.

"There seems little justification for considering expenditure on children to be a measure of their cost, any more than going to a restaurant can be considered a cost to the patrons," Dr Dockery said. Restaurant-goers saw their night out as a benefit, not a burden.
To begin, food is a cost; the act of dining in a restaurant merely increases the price of a necessity. Furthermore, since the alternative is cooking, which costs the diners the time of food shopping, meal preparation, and cleaning up, the meal might actually not be a luxury but a necessity; for some of us the increased expense of dining out makes up for the translated value of lost time. (which, of course, has a monetary value)

Secondly, one knows what to expect when dining out, one researches the restaurant, or dines someplace they have been before. One is likely to see a poor meal as a "cost". A parent cannot know what to expect of the experience of raising a child. Overall, if disappointed in the experience (which many studies show is common, whether admitted or realized or not) the expense of raising a child could similarly translate into a "cost."

Overall, it sounds like this Associate Professor (tenure burn!) is projecting his own values about parenting and children into this so-called study, instead of approaching it with logic and common sense. Worse yet, the failure to equalize the populations he studied makes his methodology questionable, or even useless.

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