Economists ask, What is a mother worth?

Sunday was Mother's Day, which got me thinking about our Mom and how much we appreciated her. You can't put a price on that. Or can you? Should you? I think we all should put a price on motherhood.

It took economics for me to change a lot of my thinking about mothers and motherhood. Actually, those ideas had been changing slowly over a long period of time. But things really got started when I read an article about, of all things, the history of the statistic we know as the Gross National Product, or GDP. 

I was preparing to teach several courses at the University of Navarra in Spain. They had invited me as visting professor of communication, and I was supposed to teach economics and the economics of media. I was fearful of being revealed as a fraud.

Although I had written about business and economics for most of three decades, my formal education in the field consisted of a solitary but memorable introductory course taken in college a century ago.

Not our university, but one like it.

My new teaching colleague had written a book in Spanish called Economics for Communicators. Reading it made me realize that, although I had been applying economics theories in my journalism for years, I did not know or understand those theories well enough to be able to explain them to a bunch of 19-year-olds. Nothing is scarier than confronting a classroom of skeptics eager to expose your ignorance with ruthless glee.

So I was doing my homework on microeconomics and came upon an article in the Financial Times: Has GDP outgrown its use. 

What GDP doesn't capture or value

The article made a couple of points that got me thinking about how society values what women do, and mothers in particular. GDP really grew out of the Depression of the 1930s. President Franklin D. Roosevelt wanted to know, in essence, how bad things were and which government policies could make things better, as Diane Coyle describes in the article mentioned above.


Coyle actually wrote a book about the history of GDP and many of its limitations. She noted that this widely used metric does not, for instance, put any value on whether a country is investing in its transportation or health-care infrastructure. GDP doesn't include the value of many activities--for example, illegal drug sales, volunteering, or the work of a stay-at-home spouse and mother.

A parent's work includes giving an ethical and cultural education to the next generation so they can contribute their physical labor, ingenuity, and innovation to their community, even to putting their lives on the line to defend it. What is parenting worth?

If a parent's work in the home is valuable, economists can and should be able calculate its value--in market terms, a price. Prices help us decide whether we do or don't want to do things. Prices measure the value we place on certain social goals. Social Security and Medicare taxes are the price we are willing to pay to take care of older generations. Taxes on cigarettes are the price of damage to public health and a disincentive to smoke.

GDP also does not count the time that parents spend as volunteers on school, church, and recreation activities. This work brings value to the entire community through the contributions of the younger generation when they become adults--a positive externality, in economic terms. Mothers often bear most of the responsibility for this.

The social agency as the extended family

When I got involved with the United Way in Baltimore, I visited lots of social service agencies. What struck me was that these agencies were usually attempting to replace the social supports that would be supplied by an extended family. From child care for working parents, to food and health care for the poor, to job training for the unemployed, many of these agencies were doing what you used to ask your cousin or uncle or sister-in-law to do for you. 

"Uncle Joe, could you see if you can find something for Marie? She's a good girl, been in some trouble, but she's smart, and wants to learn and just needs a job to get started. But she'll have to take time off once a week to meet with her parole officer." "OK, tell Marie to come by and I'll put her to work in our office."

These days we expect social service agencies to do that, and it has a cost. And we expect Marie to work, but, who will take care of Marie's baby boy? And who will drive her to work, since she can't afford a car and there is no public transit that connects her home and work? Do we have an agency for that? And have we invested enough in public transportation rather than wider expressways to the suburbs?

Measuring the right things to get the right results

I explained my misgivings about GDP's usefulness to an economist I know. "But it's the best thing we have," he said. "Everything else is opinions and anecdotes and political ideology."

GDP is often used to measure a country's economic well-being much like sports analysts evaluate a player by their batting average or points per game. But even sports analysts know that there are many other metrics that have to be taken into account to fairly evaluate a player.

So, economists and policy makers dissatisfied with GDP have developed a field of new metrics called Happiness Economics. These metrics attempt to quantify how effectively policymakers are using their resources to improve the quality of life for their citizens. Investopedia explains some of the thinking this way:

"For people earning low levels of income, many economists discovered that more money does generally increase happiness as it enables a person to buy goods and services considered essential to the basics of life such as food, shelter, health care, and education. But there is believed to be a threshold, somewhere in the region of $75,000, after which no amount of extra money is reported to boost life satisfaction."

"Other factors that impact happiness include the quality and type of work people are doing, as well as the number of hours they are working. Several studies show that job satisfaction is more important than income levels. Boring repetitive jobs may give little joy, while self-employment or work in creative skilled jobs can lead to greater satisfaction."

One study in this field is the annual World Happiness Report. It ranks countries on GDP but also on how effectively they are performing on quality-of-life measures such as household income, life expentancy, infant mortality, public corruption, public safety, and, yes, individual optimism or pessimism. Just how these rankings are calculated--sources of data, the weight given each factor--is explained in impressively technical detail in the report. The metrics are constantly being revised and updated.

In the graphic below, notice that the U.S. ranks 18th in the happiness index although it has very high  GDP per person. Many Latin American countries rank much higher than you might expect. It's because people there have strong social connections with their communities--extended family being one factor. The full list of 153 countries is on p. 19 of the report.

Click to enlarge. P. 19, World Happiness Report 2020

Back to Mom

So, all of this reading got me thinking about how I personally valued what mothers do. The self-examination left me feeling ashamed. In doing genealogical research, for example, I had focused way too much on tracing the paternal lines of our ancestors. I neglected the stories of how the women had contributed to the family history. If you will, the family's happiness score.

The reflection made me think about the time 25 years ago that I hired a woman who was a few months pregnant. She had very good credentials. Our understanding was that she would tell us when she needed to leave to have her baby and when she wanted to return.

There was no paid maternity leave, but she and her husband didn't need the income. She simply wanted to work as a journalist. She also wanted to breast-feed the baby, her first. I was not as accommodating as I could have been with her unconventional schedule. After a few weeks, she left. It bothers me that I didn't place enough value on what she was trying to do for her child. It didn't fit our business model. It also didn't fit our society's model at the time for valuing motherhood, child care, and family stability.

Another realization, also was gradual. Over the years I had slowly come to appreciate how much more time Cindy spent than I did on the work of raising our three kids, despite working full time. She focused more energy than I on finding the right day care for them, then monitoring whether they did their homework, shopping for their clothes, worrying about their lunches and dinners, paying attention to their schedules of non-school activities, taking them to church, etc., etc., etc. I was involved but never as much. Not by a longshot.

For many years, Cindy worked from home as a senior computer programmer and analyst. She took time off, however, when our third and youngest, Patrick, was born. Before returning to work, she spent a great deal of time researching where to find the best day-care for Patrick. Not until then was she ready to go back to work.

If our three kids are productive members of society--and they are--it is largely because of her work. In order to produce more Cindys, society has to find the right mix of services and incentives so that this work of mothering (or parenting, to tip the hat to fathers doing this work) gets done well. We didn't need financial support, but others do. This is especially true these days in developed economies, when both parents work, either by choice or necessity. All of society benefits from their work.

The work of grandparents

We have lived in Spain for five years and in China for two, and grandparents play an important economic role in both countries. Grandparents take kids for walks or for play in the parks. They take care of their grandkids during the day so the young parents can work. This arrangement surely existed for the last 100,000 years or so of homo sapiens. I mention this because it goes back to the mention above of the importance of the extended family. In these two countries, several generations of a family often live within a few minutes drive of each other.

In the U.S., we push kids out the door at 18. They go to college or take jobs far from home. This is good for the economy--free labor markets, free movement, upward economic mobility--but it comes at a social cost. Very often, parents with children live too far from the rest of their families to help them through the many crises they confront. The social cost of this separation is measurable in the price we pay for private social service agencies and public social safety nets to replace what the extended family does for a person.

Value creation for society

Cindy's mom, Dorothy Kuhn, worked from home as a piano teacher to help support the family. My mom, Ruth Breiner, went to work in a public library as soon as her youngest, Betsy, started school.

My mother's mother, Anna Lavelle, went to work at 15 when her father died, leaving behind 10 children. My mother's grandmother, Anna Gilles Hausser, was left a widow at 38, with four children. She and her oldest son and daughter then took over and ran the family bakery business. My father's mother, Magdalena Frowerk, went to work in a shirt factory as a teenager and helped support her family.

Who's saving us from covid-19?

One of the many discoveries of the covid-19 crisis has been that many of the front-line jobs defined as "essential"--grocery store clerks, nurses, health care workers, social workers, meat packers--are women. Just look around you.

These are people who can't work from home. They have to take public transit or drive to work. If they don't work, they don't get paid and lose their health insurance, if they are lucky enough to have it. And these are the people who are most at risk of getting infected.

A new study by the Brookings Institution, a think tank, found that among the top five occupations with the most exposure to the disease, three of them--nurses, home health care workers, and meat packers--were making less than $12 an hour (the chart is at this link). And many of these jobs are held by immigrants and women (more on this in a podcast from The Indicator from Planet Money).

Compare that $12 an hour to the emergency unemployment benefit from the federal government: $15 an hour ($600 a week), but these essential workers can't quit and go on unemployment, even though unemployment would pay more. They have to be laid off. But employers need them, so that won't happen.

In the U.S. we have a legal system that operates on the presumption that you are innocent until proven guilty. But in our social welfare system, it's the opposite: you are deemed to be unworthy--either lazy or stupid or faking it--unless proven otherwise. In Europe, the presumption is the opposite: if you are poor, it's probably not your fault. If some fakers and gold-bricks get through, that's a price they're willing to pay to make sure the truly needy are helped.

So what is a mother worth? What is the care and love of a parent worth to society in terms of forming the next generation of contributors to the strength and stability of the community, to the next bearers of the community's cultural heritage? Whatever that value is, we in the U.S. have not begun to recognize it in our public policies. We need to treat each mother as if she were our own mother. And that means more than sending her a card and flowers once a year.