The "Cost Analysis" for Baby No 2

Following my previous post, blog "readers" (not that many though) have kindly pointed out that A&E's conversation on Baby No.2 had left out an important factor - Cost.
I even received smses to remind me that beyond sperm quality, THE COST involved should be a an important variable for consideration.
There is even one sms that read something like -
"aiya, your husband so rich, confirm can support a SAHM and 4 kids LOL"

Seriously, if we are THAT rich, we would be spotted in Porsche now and probably getting our property in River Valley/Orchard. I would not say we are poor (definitely not), but we are relatively comfortable. The decision for me to stay home is made based on our child-rearing beliefs and really, we made big adjustments in our lifestyle to accommodate that decision. I guess its just a personal preference.

Anyway, this post was born out of a rather interesting (or comical) conversation with the hubby on THE COST of Baby No.2. Trust me, between the 2 of us, I'm the one that is very mindful of THE COST. However, his usual over-logical-explanation-which- makes-perfect sense cracks me up as usual.
(Note to self - That's one reason why I marry him.)

According to him, Cost from an Economics standpoint should be viewed as Opportunity Cost and not just Price, as determined by demand and supply of market forces, which by itself is relative.

Opportunity Cost (OC) = the opportunities forgone in the choice of one expenditure over others
The OC of yours truly choosing to be a SAHM is the economic returns from working + potential future returns (measured in possible promotions, bonuses etc). The decision to have Baby No.2 does not change the OC already incurred in having Baby No.1 (albeit, w/0 Baby No.2, I'll probably be able to return to workforce earlier)
So from this perspective, it probably makes more sense to have Baby No.2 and No.3 to justify the OC incurred.

Next up, Sunk Cost
Sunk Cost = Cost incurred which cannot be recovered regardless of future events
The husband promptly reminded me the vested investment in the bundle of baby stuff that we've purchased from the US - electric breast pump, peg perego stroller, baby bjorn carrier, the 2 boxes worth of baby and toddler's clothing, Cosco car seat, the Braun electric thermometer, the tons of Fisher and Price toys etc.. these are sunk cost that cannot be recovered!
Hence, to enjoy Economics of Scale (EOS), it totally makes sense to have baby No.2 and SOON while the goods are still in good condition. EOS is also reaped when you purchase diapers in bulk for 2 babies, prepare baby food in bulk for 2 babies, organize field trips and excursions for 2 or more kids etc etc.

Yup, thats my hubby for you!
After OC, Sunk Cost and EOS, the argument based on ROI and Indifference Curve ensued.

I shall not even attempt to bore you guys with my attempted rebuttal based on the Diminishing Marginal Utility aka (Pleasure) of child rearing.
Boy, did we we have a good laugh over this so-called "rationalization"!

But really, parenthood is a lifelong responsibility.
How does one monetise the energy, effort, headache and worries that ensued with parenthood? How do I quantify also the joy and fulfillment in watching the little one's journey to adulthood?
I cant begin to put a price tag to it.

I read this beautiful quote by Elizabeth Stone years back:

“Making the decision to have a child is momentous. It is to decide forever to have your heart go walking around outside your body.”



What a beautiful and profound statement. I'm only JUST beginning to comprehend this.

To Parenthood.