How the Pill Drives Economic Growth

How the Pill Drives Economic Growth

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Everyone seems to have an opinion on birth control these days. But whether you believe birth control should be free and readily available to everyone, or if you (most likely quietly) agree with Rush Limbaugh that taxpayer support of birth control essentially turns women into prostitutes, a new working paper from the National Bureau of Economic Research says that the pill has actually helped generate those taxpayers’ jobs and salaries. The researchers calculated that the pill accounted for 10 percent of the growth women have made in the workplace, and has significantly helped close the gender wage gap by adding an additional 8 percent to a woman’s hourly wage by age 50.

To quantify its importance, the researchers looked at the particularly striking growth in women’s wages in the 1980s – going from women earning 60 percent of what their male counterparts earned in 1979 to earning 69 percent in 1989. Although there were many factors that contributed to this (like more women attending college, and the women’s rights movement), they saw a strong correlation with the proliferation of the pill.

In the 1960s, states that changed the age of consent for medical care from 21 to 18 saw pill use among women 18-21 double, but not beyond age 21. Data show that this early access to the pill first lowered women’s wages while they were “investing in their human capital” in their early 20s, but then raised their wages in their 30s and 40s, which corresponded with the rapid rise of wages in the 1980s. In addition, the participation of women in their 30s in the workforce increased by 16 percentage points in the 1970s, and another 14 percentage points in the 1980s.

Though the paper did not look at the wider economic effects birth control has had, countless studies have looked at how women in the workforce have contributed to GDP growth, with a piece in the Economist even declaring that “over the past decade, the increased employment of women in developed economies has contributed more to global growth than China.”

Blaire Briody is a contributing editor at The Fiscal Times. Her work has appeared in The New York Times, Popular Science, Publishers Weekly, among others.