Parenting, Raising Children, and Rising Debt

University Of California-Irvine, Irvine CA

Investigators

Abstract

This project will study the link between raising children and rising debt and examines the implications for growing economic inequalities. The U.S. Federal Reserve reports that total household debt in the U.S. has climbed to a staggering $12 trillion. Demographers document increasing expenditures for raising children over time. This project will determine the extent to which these two trends are related, and whether households take on debt to invest in their children. As such, this study will help us better understand the drivers of American household indebtedness as well as the rise in family income inequality and widening children's academic achievement gap. The findings of this project will inform policy proposals on funding of public education from preschool to high school, and the risks of widespread reliance on educational loans to facilitate social mobility of the new generations of Americans. The investigators will broadly disseminate results through presentations and publications in scholarly articles and a book, as well as general-interest essays and in communications aimed at policymakers. The project will also provide training and mentorship opportunities by involving female and underrepresented minority graduate and undergraduate students in the research process and publications. This will facilitate their success on the job market or for graduate school entry, promoting their participation in STEM. The specific research goals of this project are to determine the levels of overall debt, and, separately, levels of mortgage, educational and credit card debt, for families with children in the home, compared to families without children, and how such indebtedness has changed since the early 1990s. The project will also determine how debt and debt type differs by socio-economic status and race/ethnicity of families. Lastly, the project will investigate how families understand investment in children, including the legitimacy of taking on debt for the sake of raising kids. Quantitative data from the tri-annual Survey of Consumer Finances (1989 through 2013) and Panel Study of Income Dynamics (1997-2013) as well as 50 semi-structured interviews with households will be analyzed to answer these questions. The project will advance scholarship in economic sociology on the moral and emotional economy, using parenting as a new strategic research site. The findings will contribute to cultural sociology that treats meaning-making as central to theorizing about economic inequality. Analyzing the raising kids/rising debt nexus will question the common divide between private family concerns over children, on the one hand, and the functioning of financial markets, on the other hand. This study will expose how features of the new economy--stiff competition, economic insecurity, and paramount knowledge investment --infiltrate the intimate lives of families, all the while the resultant new economy of parenting, reliant on debt and financing to invest in children, upholds the contemporary financialization of the U.S. economy.