Children as insurance

This paper presents a dynamic model of fertility decisions in which children serve as an incomplete insurance good. The model incorporates uncertainty about future income and the survival of children as well as a discrete representation of the number of children. It contributes to the understanding of the negative relation between fertility and education, shows why parents may demand children even if the return is negative, and explains why fertility might rise with increasing income when income is low and decrease when income is high. Furthermore, the model can account for the decline in fertility when the risk of infant and child mortality decreases. Finally, the implications for empirical tests of the demand for children are also examined. Received: 8 September 1998/Accepted: 9 June 1999     

Social Class Differentials During Fertility Decline: England and Wales Revisited

This paper reviews the relationship between landholdings and fertility. Two dimensions of land are identified as salient for fertility behaviour: size of operational holdings and land ownership. It is suggested that these two dimensions and the resulting income streams have disparate effects on fertility. Size of holdings is assumed to have a positive influence on fertility due to the greater labour demands of larger holdings, while land ownership is posited to exert a negative long-term effect because of the increase in old-age security associated with the income returns to equity. In addition to these effects on the demand for children, landholding is also thought to influence the supply of children. A systematic review of the literature finds support for the impact of both dimensions of landholding on fertility preferences, contraceptive behaviour, the proximate determinants and fertility. Both the demand and supply of children appear to be influenced by landholdings. The observed regularities suggest the need for further research on this connection, not the abandonment of this line of inquiry.     

Fertility and the economy

I relate the demand for children to parental incomes and the cost of rearing children — especially to the value of the time spent on child care and to public policies that change the cost of children. This paper also links the demand for children to investments in their human capital and other dimensions of the so-called quality of children. Fertility is shown to depend too on child and adult mortality, uncertainty about the sex of children — if there is a preference for boys, girls, or for variety — uncertainty about how long it takes to produce a conception, and other variables.Since biological necessity dictates that succeeding generations overlap, it is not surprising that fertility in one generation influences the fertility of succeeding generations. The overlapping generations approach provides a useful framework for relating fertility choices to population growth and macroeconomic changes.The modern approach to fertility leads to very different interactions between population growth and economic growth than is implied either by Malthusian or the usual neo-classical growth models. In particular, it provides a framework for analyzing how societies escape a Malthusian-like stagnating equilibrium and embark on the journey toward becoming modern economies, where per capita incomes, human capital, and physical capital all continue to grow, fertility declines to rather low levels, and married women participate extensively in the labor force.This essay was prepared for the Nobel Jubilee Symposium, Lund, Sweden, December 5–7, 1991. I have had valuable comments from James Heckman, Robert Willis and my discussants at the symposium: Allesandro Cigno and Richard Easterlin, and useful assistance from Becky Kilburn. I am indebted to the National Institute for Child Health and Human Development award R37-HD22054 and National Science Foundation award SES-90-10748.     

Muslim and Non‐Muslim Differences in Female Autonomy and Fertility: Evidence from Four Asian Countries

On the basis of research on paired Muslim and non‐Muslim communities selected in India, Malaysia, Thailand, and the Philippines, the authors test the hypothesis that greater observed Muslim pronatalism can be explained by less power or lower autonomy among Muslim women. Indeed, wives in the Muslim communities, compared to the non‐Muslim ones: 1) had more children, 2) were more likely to desire additional children, and 3) if they desired no more children, were less likely to be using contraception. However, the authors do not find that Muslim communities consistently score lower on dimensions of women's power/autonomy. Thus, aggregate‐level comparisons provide little evidence of a relationship between lower autonomy and higher fertility. Individual‐level multivariate analysis of married women in these paired settings similarly suggests that women's autonomy differentials do not account for the higher fertility, demand for more children, and less use of contraception among Muslim wives. These results suggest that explanations for Muslim/non‐Muslim fertility differences lie elsewhere.     

Do children stabilize relationships in Denmark?

In this paper, we study the relationship between fertility behavior and the process of relationship duration. The potential endogeneity of fertility on dissolution risk is taken into account by modeling fertility and dissolution jointly. We apply the timing-of-event method (Abbring and van den Berg, Econometrica 71(5):1491–1517, 2003) to identify the causal effect of births on the dissolution hazard. We show that couples who are less prone to split up are more prone to invest in children, and therefore, one might (mistakenly) conclude that children stabilize relationships. However, when correcting for the selectivity bias arising from the fertility decision, we conclude that children themselves have a negative effect on relationship duration.      

Toward a general theory of fertility: A causal modeling approach

A general theory of fertility is derived hypothesizing that the demand for children is primarily an outcome of social psychological processes within the family, subject to certain socioeconomic constraints. Two broad social psychological processes are posited as determinants of fertility. The first suggests that the attitudes or tastes of family members influence the demand for children. The second maintains that the nature of the husband-wife interaction (in terms of power, conflict, decision making, and marital satisfaction) determines family size. Socioeconomic variables, in the form of the normative social structure and social stratification, and economic constraints, such as income and price, are hypothesized to influence fertility through their impact on social psychological processes within the family. The overall theory is tested on two independent samples—one in Ankara, Turkey, the second in Mexico City, Mexico—using a structural equation methodology.     

How female education affects reproductive behavior in urban Pakistan

Although Pakistan remains in a pretransitional stage (contraceptive prevalence of only 11.9% among married women in 1992), urban women with post-primary levels of education are spearheading the gradual move toward fertility transition. Data collected in the city of Karachi in 1987 were used to determine whether the inverse association between fertility and female education is attributable to child supply variables, demand factors, or fertility regulation costs. Karachi, with its high concentration of women with secondary educations employed in professional occupations, has a contraceptive prevalence rate of 31%. Among women married for less than 20 years, a 10-year increment in education predicts that a woman will average two-fifths of a child less than other women in the previous 5 years. Regression analysis identified 4 significant intervening variables in the education-fertility relationship: marriage duration, net family income, formal sector employment, and age at first marriage. Education appears to affect fertility because it promotes a later age at marriage and thus reduces life-time exposure to the risk of childbearing, induces women to marry men with higher incomes (a phenomenon that either reduces the cost of fertility regulation or the demand for children), leads women to become employed in the formal sector (leading to a reduction in the demand for children), and has other unspecified effects on women's values or opportunities that are captured by their birth cohort. When these intervening variables are held constant, women's attitude toward family planning loses its impact on fertility, as do women's domestic autonomy and their expectations of self-support in old age. These findings lend support to increased investments in female education in urban Pakistan as a means of limiting the childbearing of married women. Although it is not clear if investment in female education would have the same effect in rural Pakistan, such action is important from a human and economic development perspective.     

Economic determinants of fertility: Results from cross sectional aggregate data

Census data for areal units, SMSA’s in 1960 and cities in 1940, are used to test hypotheses and estimate parameters concerning the influence of a variety of socioeconomic variables on fertility rates of ever married white and nonwhite women aged 25–29, 30–34, 35–44, and 45–49. An economic model of the demand for children is adopted as the theoretical framework. The principal findings are that the market earnings opportunities for wives have an important negative effect on the fertility rate and that male income, representing the income of husbands, has a small but positive effect on fertility. The implication of these results is that changes in economic variables, for example, improvements in the employment opportunities and wages for wives or the establishment of a children’s allowance program, may be expected to affect fertility.     

The influence of rural-urban migration on migrants' fertility in Korea,Mexico and Cameroon

The paper presents a comparative analysis of the relationship between rural-urban migration and fertility in Korea, Mexico, and Cameroon. Using an autoregressive model, the results show a significant rural-urban migration adaptation effect in Korea and Mexico, a reduction of 2.57 and 1.45 children during the entire childbearing period, respectively, when compared to a rural stayer, even after the effect of selection has been controlled. Rural-urban migration has a very small impact on fertility in Cameroon. The unexpected result for Cameroon is due to the fact that the fertility-increasing effect of urban residency on the improved supply conditions of births, such as reduced infertility, offsets the fertility-depressing effect of urban residency on the demand for births. As a result of the adaptation to urban fertility norms, the number of country-wide births was reduced significantly in Mexico and Korea over the time periods studied.     

A Theory of Marital Fertility Transition

In this paper a theory of marital fertility transition that treats birth control diffusion processes and the effects of mortality decline and economic and social development on fertility within a common analytical framework is developed. Utility-cost concepts provide the means for an integrated treatment. Family size utility functions are used and the theory is focused on the effects of development and diffusion on the utilities and costs of alternative family sizes. The principal innovation lies in the conceptualization and analysis of diffusion of birth control, in which the psychic costs of violating social norms against birth control play a central role. When norms shift in favour of birth control, the psychic costs of birth control fall, causing a decline in the demand for children. In highly integrated populations this process can occur very rapidly, resulting in rapid diffusion of birth control and sudden and rapid fertility decline.     

The empowerment of women,fertility, and child mortality: Towards a theoretical analysis

This paper examines one avenue through which female autonomy impinges on fertility and child mortality in developing countries. A simple model is set out in which couples are motivated to have children for old age security purposes. The decisions of a couple regarding fertility and allocation of resources for the healthcare of their children are made within a bargaining framework. An increase in female autonomy translating into an increase in the relative bargaining power or the threat point utility of mothers is shown to reduce fertility and also to reduce child mortality rates. Paradoxically, the increase in female autonomy within a household may increase the disadvantage suffered by female children in that household with respect to survival. Received: 4 August 1999/Accepted: 7 September 2000     

Perspectives on family and fertility in developing countries

Abstract Two aspects of the family in relation to fertility in developing countries are discussed: set stratification within the family and extended family networks. As both these are central to J. C. Caldwell's theory of fertility transition, the paper is structured as a critique of his position. Drawing on examples and data from Asia, it is argued that the causal significance of sex stratification for fertility lies in the economic risks it imposes on women, deriving from their dependence on men, rather than, as Caldwell suggests, in the disproportionate gain that men derive from their dominant position within families. While Caldwell and others associate strong extended family networks of mutual obligation and support with persistent high fertility, it is argued here that such systems should, instead, facilitate fertility decline. Close-knit and strong kin networks can be viewed as alternatives to children as sources of insurance, and may facilitate fertility decline by preventing children from becoming the focal point of parental concerns for security.     

Will sex selection reduce fertility?

This paper investigates both theoretically and numerically the impact of sex selection on fertility. A static quantity-quality model of fertility is employed to compare fertility choices in two regimes: one in which parents cannot choose the gender of children and another in which parents can fully choose the gender of children. The static theory shows that whether sex selection reduces fertility depends on the second and third derivatives of the utility function and the child expenditure function. A numerical dynamic analysis is also presented. Using empirical dynamic models of fertility and Monte Carlo integration technique, the simulation shows that sex selection on the firstborn child among the Chinese in Malaysia could reduce fertility by about 3%.I thank the referees for their comments. I am indebted to James Heckman for providing generous computing support. Computational facilities were funded by NICHD Grant HD-19226 and NSF Grant SES-84-11242 to the Economics Research Center, NORC.     

Uncertainty about children's survival and fertility: A test using indian microdata

In this paper we present a non altruistic model of demand for children in the presence of uncertainty about children's survival. Children are seen as assets, as they provide help during old age. Theoretical predictions relating to the change in the mean and variance of the survival rate are derived. The empirical analysis is based on data from the Human Development of India (HDI) survey. Different models for count data variables, such as Poisson and hurdle models have been employed in the empirical analysis. The results highlight the importance of the uncertainty about children's survival in determining parental choices. This shows that realized or expected children's death is not the only link between fertility decision and children's mortality. The policy implications of such findings are briefly discussed. Received: 20 August 1998/Accepted: 19 July 1999     

An Econometric Investigation of Easterlin's ‘Synthesis Framework’: The Philippines and the United States

In this paper we estimate a fertility model based on Easterlin's synthesis framework. The model assumes that not all couples are able to achieve their desired number of living children because of supply constraints and that, for other couples, the number of living children may exceed desired fertility, depending upon child mortality, the level of fertility in the absence of control, and the degree of contraceptive regulation practised. Estimates of the model for samples of women with completed fertility taken from the Philippines (1973) and the United States (1965) indicated that a higher proportion of Filipino women than women in the U.S. were unable to achieve desired fertility because of supply constraints, that levels of fertility control of Filipino women not supply-constrained were lower, and that excess fertility of Filipino women was much higher. Demand-for-children equations based on the constraints model were quite different from those not taking into account the possibility that some women were supply-constrained, or that some women may have had more children than desired.     

A model of voluntary childlessness

Demographers and sociologists have studied why women remain childless for more than two decades; however, this specific choice of zero fertility has not interested economists. Permanent childlessness, in developed countries, can concern up to 30 % of the women in a cohort. Childlessness rates can be positively related to average fertility for some cohorts of women. This paper provides an explanation for this using an endogenous fertility model where individuals have different preferences for children. The main mechanism considered goes through the intergenerational evolution of preferences: I show that a reduction in the gender wage gap, or an increase in the fixed cost of becoming a parent, has a negative effect on both fertility and childlessness. The reduction of childlessness is due to a composition effect: small families shrink more than larger families, and this reduces childlessness.     

High Fertility and Children's Schooling in Ghana: Sex Differences in Parental Contributions and Educational Outcomes

This paper explores the linkages at the family level between sustained high fertility and children's schooling in Ghana, in the context of a constrained economic environment and rising school fees. The unique feature of the paper is its exploration of the operational significance of alternative definitions of “sib size” – the number of “same-mother” siblings and “same-father” siblings – in relation to enrolment, grade attainment, and school drop-out for boys and girls of primary and secondary school age. The analysis is based on the first wave of the Ghana Living Standards Measurement Survey (GLSS) data, collected in 1987–88. The results of the statistical analysis lead to the conclusion that the co-existence of high fertility, rising school costs, and economic reversals is having a negative impact on the education of girls, in terms of drop-out rates and grade attainment. Some of the costs of high fertility are borne by older siblings (particularly girls) rather than by parents, with the result that children from larger families experience greater inequality between themselves and their siblings by sex and birth order. Because fathers have more children on average than mothers, the inequality between their children appears to be even greater than between mothers' children, particularly given the importance of fathers' role in the payment of school fees. The paper concludes that the greatest cost for children in Ghana of sustained high fertility is likely to be the reinforcement of traditional sex roles, largely a product of high fertility in the past.     

Child mortality and fertility decline: Does the Barro-Becker model fit the facts?

I compare the predictions of three variants of the altruistic parent model of Barro and Becker for the relationship between child mortality and fertility. In the baseline model fertility choice is continuous, and there is no uncertainty over the number of surviving children. The baseline model is contrasted to an extension with discrete fertility choice and stochastic mortality and a setup with sequential fertility choice. The quantitative predictions of the models are remarkably similar. While in each model the total fertility rate falls as child mortality declines, the number of surviving children increases. The results suggest that factors other than declining infant and child mortality are responsible for the large decline in net reproduction rates observed in industrialized countries over the last century. Financial support by the National Science Foundation (grant SES-0217051) and the UCLA Academic Senate is gratefully acknowledged. I thank Sebnem Kalemli-Oczan, Rodrigo Soares, and two anonymous referees for comments that helped to substantially improve the paper. Olesya Baker and Ilya Berger provided excellent research assistance. Responsible editor: Junsen Zhang.     

Increasing contraceptive use in Bangladesh: The role of demand and supply factors

This article analyzes the determinants of contraceptive use in Bangladesh, focusing on the roles of demand for additional children and of family planning service supply. Data from the Matlab Family Planning Health Services Project are used to examine the contributions of these factors to the difference in prevalence of modern contraceptive use between the project area and a control area served by the government family planning and health programs. Results of multivariate analysis deriving from the Easterlin synthesis framework show the importance of family planning supply factors in reducing psychic and resource costs of fertility regulation and in activating latent demand for contraception. Demand for birth limiting and for birth spacing emerge as important explanatory factors; demand for birth spacing is greater in the project area, and both demand measures exert a stronger effect on contraceptive behavior in that area.     

Sex selection and fertility in a dynamic model of conception and abortion

This paper investigates the effect of prenatal sex selection on fertility through a stochastic dynamic model with uncertainty in conception as well as in gender, where a woman makes decisions on conception and abortion with or without gender detection tests (i.e. sex-selective or sex-unselective abortion). The paper shows that, when the cost of gender detection test falls, the sex ratio at birth rises due to more selective abortions, but fertility can rise or fall with rising sex ratio. Fertility may rise (fall) if there are more (less) women giving up unselective abortions for selective abortions than women giving up childbirths without test for selective abortions. Similarly the paper shows that the sex ratio can rise or fall, when fertility decreases as the cost of children increases. I test these propositions as well as their implications against micro survey data on the pregnancy history of Korean women.Responsible editor: Junsen Zhang.