Do unmarried births among African-American teens lead to adult poverty?

Denying Aid to Families with Dependent Children benefits to teenage single mothers is justified by claims that out-of-wedlock teen childbearing leads to adult poverty and welfare dependency. Cross-sectional research shows that teen mothers are likely to be poor and on welfare as adults. We use sisters data from the Panel Study of Income Dynamics to investigate whether the association between teen out-of-wedlock birth and adult poverty and welfare use is causal or if it occurs because unmeasured background disadvantages cause both teen birth and subsequent adult poverty and welfare use. Results show that much, but not all, of the observed association is due to unmeasured family characteristics.