The Economic Costs of Poverty: Subsequent Effects of Children Growing Up Poor

Publication Date: January 2007

Publisher: Center for American Progress

Author(s): Greg J. Duncan; Diane Whitmore Schanzenbach; Harry Holzer; Jens Ludwig

Research Area: Social conditions

Type: Report


Most arguments for reducing poverty in the U.S., especially among children, rest on a moral case for doing so—one that emphasizes the unfairness of child poverty, and how it runs counter to our national creed of equal opportunity for all.

In this paper, we review a range of rigorous research studies that estimate the average statistical relationships 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 per person 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 U.S. to estimate the aggregate costs of child poverty to the U.S. economy.