Even in death, Victor Fuchs has a message to share

In life, Victor Fuchs had a lot to say and wasn’t afraid to say it. Two years after he died in his Stanford home at the age of 99, the pioneering health economist and champion of women’s equality is still making his views known.

His message — that there’s a strong case to be made for how child-care subsidies empower women which, in turn, helps bring them closer to economic equality with men — is the subject of research that Fuchs helped draft in the late 1980s at a time when few economists were thinking about the broad effects of family policies.

Fuchs’s paper was never released, but he never forgot about it. Nor did his co-author.

Now, with the approval of Fuchs’s family, the study has finally seen the light of day as a Stanford Institute for Economic Policy Research (SIEPR) working paper. His co-author, Hersh Shefrin of Santa Clara University, resurrected it to make good on a promise he made to Fuchs over the years, long after they had shelved it, and in light of recent government policies that Shefrin says are harmful to women. Fuchs, he says, would vehemently agree.

“Even late in life, our paper was still on his mind,” says Shefrin, a finance professor whose research has helped shape the field of behavioral economics. In 2017, at a Stanford tribute to the late Kenneth Arrow, a Nobel laureate and longtime economics professor at the university, Fuchs brought it up again when he and Shefrin got to talking after they both gave eulogies.

“Although Vic was in his early 90s, he was still that big guy with that big voice,” recalls Shefrin. “He said to me, ‘Do you think you’ll be able to finish it one day?’ And I said, ‘yes.’”

Power imbalance in the home

The paper is based on an idea that Fuchs, who joined Stanford’s faculty in 1974, had as he was researching in the 1980s gender inequality and the obstacles women face in achieving parity with men. Not a lot was known at the time about the economic effects of child-care subsidies, but Fuchs believed they have an important role to play in empowering working mothers. Fuchs concluded that women “demand,” or value, children more than men do because of biology and socialization. Because of this, women with children are more likely to sacrifice their careers, by working fewer hours or taking lower-paying jobs. Within marriages, these choices undermine women’s power relative to their male spouses, which Fuchs believed explains a lot about why women continue to struggle for equality.

“Vic’s argument was that, because women place a higher value on having and raising children than men do, the dynamics within families involve biases that disadvantage women,” Shefrin says.

The way Fuchs saw it, child-care subsidies would then empower women in marriages and those who are single to choose higher-paying careers. It would also give women more leisure time, which Fuchs argued is also key to their overall economic well-being.

Rhetoric vs. reality of policy shifts

Fuchs and Shefrin, who first met in the late 1970s, laid out these ideas in their original paper. Their analysis uses game theory, suggested by Shefrin, to explain the power imbalance between working mothers and their male spouses, and how child-care subsidies help level the playing field. They wrote the paper in 1988, when both were working on Stanford’s campus: Fuchs as a Stanford professor and Shefrin as a visitor, at Fuchs’s invitation, while on a work sabbatical from Santa Clara University.

While they didn’t publish the paper back then, Fuchs summarized it in his 1989 analysis, “Women’s Quest for Economic Equality,” which was published in the Journal of Economic Perspectives.

When Shefrin set out this summer to make good on his promise to Fuchs to update and publish the paper, he could not locate the floppy disk containing the most recent version. However, he did find notes stored on an old hard drive, which helped him to reassemble the main arguments.

The impetus to complete the paper, Shefrin says, was the passage in July of the One Big Beautiful Bill Act (OBBBA), and the difference between the rhetoric and the reality of what it will do to American families. On its face, the law appears to support their paper’s thesis by increasing the per-child tax credit by $200, to $2,200, and introducing a savings program for newborn children. But Fuchs would argue that the subsidies aren’t large enough to make a difference, says Shefrin. Fuchs, he adds, would also view the law’s other provisions, including changes to Medicaid and the Supplemental Nutrition Assistance Program, as harmful to women and children, especially those in low income families.

“Vic’s mission was about social justice and how to make the world better using economic principles,” Shefrin says. “He always had important things to say, and they are as resonant today as they were during his lifetime.”

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Fuchs, often referred to as the dean of health care economics, died on September 16, 2023. He was the Henry J. Kaiser, Jr. Professor of Economics and of Health Research and Policy, emeritus, at Stanford; a senior fellow, emeritus, at SIEPR; and a Stanford Health Policy (SHP) faculty affiliate. Learn more about him here.