Putting teenagers on the pill : The consequences of subsidized contraception

This paper investigates the consequences of a series of Swedish policy changes in which several regions in the 90s introduced heavily subsidized oral contraception for teenagers. The results reveal that access to the subsidy significantly increased the use of the pill as well as reduced the abortion and teenage birth rate. The decline in teenage births was especially strong among financially constrained youths. The estimates are precise enough to rule out even moderate effects on the birth weight of the children to the exposed mothers. Despite the documented improvements in women’s outcomes, the analysis reveals that the monetary costs of the subsidy substantially exceed its measurable social benefits.