We provide a novel method for modeling and estimating the impact of children on labor supply decisions. We rely on the literature on equivalence scales and collective models. Our approach takes into account both the time and monetary costs of raising children. Using semiparametric restrictions on indi vidual preferences, we identify the cost of children from the curvature of the labor supply equations with low data requirements. We apply the model to PSID data from the USA and investigate the women’s labor supply sensitivity, the cost of children, and the women’s price of time. We find that women’s labor supply is highly sensitive to wage variations. In addition, we show that mothers allocate, on average, 44\% of their net total expenditures to children. Finally, by comparing our findings to those derived from other studies using children’s expense data, our model provides relatively consistent predictions regarding the cost of children.