Measuring the cost of children Knowing the real cost of children is important for crafting better economic policy

Recent empirical estimates of the cost of children for an average family are generally close in size to the results of traditional ad hoc equivalence scales used in official publications of the Organisation for Economic Co-operation and Development (OECD). However, the empirical estimates are potentially much richer and may take into account the wide diversity of families. The cost of children may depend on a large set of explanatory variables including children’s characteristics as well as those of parents and is not necessarily proportionate to family income, as the ad hoc scales assume. Thus the empirical methods are more relevant for studying poverty and inequality. Measuring the cost of children Knowing the real cost of children is important for crafting better economic policy