Misallocated Talent: Teen Pregnancy, Education and Job Sorting in Colombia

Policy makers and international organizations often argue that teenage pregnancy affects girls’ life trajectories by, for example, limiting their employment opportunities. These concerns are amplified in regions with high teen pregnancy rates such as Latin America. We use a unique dataset from Colombia that allows us to instrument for early motherhood with the age at menarche. We find that teen pregnancy reduces school attainment and increases the number of children ever born. However, when considering eight indicators of labor supply, including labor force participation, type of job and occupation while accounting for multiple hypothesis testing, we find that much (if not all) of the negative effects on labor supply attributed to teen motherhood are due to selection. Our findings weaken the claim that early motherhood leads to a path of low-quality employment or a misallocation of talent due to job sorting. We discuss the role that family network and co-residence plays as a mechanism to buffer the effects of early motherhood on labor supply.