Fertility and the Easterlin hypothesis: an assessment of the literature

Focusing just on the fertility aspects of the Easterlin hypothesis, this paper offers a critical assessment – rather than just a selective citation – of the extensive fertility literature generated by Easterlin, and a complete inventory of data and methodologies in seventy-six published analyses. With an equal number of micro- and macro-level analyses using North American data (twenty-two), the „track record” of the hypothesis is the same in both venues, with fifteen providing significant support in each case. The literature suggests unequivocal support for the relativity of the income concept in fertility, but is less clear regarding the source(s) of differences in material aspirations, and suggests that the observed relationship between fertility and cohort size has varied across countries and time periods due to the effects of additional factors not included in most models. Received: 16 July 1996 / Accepted: 26 September 1997     

Evolution of recent economic-demographic modeling: A synthesis

This paper develops a flexible framework for modeling population's role in economic growth by assessing and extending a rendering suggested by several Harvard economists. Our framework includes a ``productivity' model explaining output-per-worker growth and a ``translation' model translating that growth into per-capita terms. We specify a core economic model and several ``enriched' demographic variants that include dependency, size, and density. Regressions using a cross-country panel spanning the period 1960-1995 reveal that combined impacts of demographic change have accounted for approximately 20% of per capita output growth impacts, with larger shares in Asia and Europe. An earlier draft of this paper was presented at a conference on ``Population Change, Labor Market Transition and Economic Development in Asia,' Institute of Economics, Academia Sinica, Taipei, Taiwan, 6–9 December 2002. A pre-publication version of this paper will be presented at a joint conference (by COE/JEPA) entitled ``Towards a new economic paradigm: Declining population growth, labor market transition and economic development under globalization,' held at the Awaji Yumebutai International Conference Center, Kobe, Japan, 17–19 December 2005. We have benefited from comments by Michelle Connolly, Andrew Mason, Pietro Peretto, Warren Sanderson, Alessandro Tarozzi, Jeffrey Williamson, and two anonymous referees. Responsible editor: Junsen Zhang.     

The extent of labour specialization in the extended family: A theoretical and empirical analysis

In this paper we present a simple model of labour supply that is cast within the framework of an extended family. The model emphasizes a Ricardian division of labour whereby the specialization is solely driven by marginal productivity and value of time differentials. The empirical implications of the model are derived and tested using data that was collected in France to study the extent of trade within the family network. We find evidence that the extent of specialization is sensitive to the value of time differentials. Received: 17 May 1995 / Accepted: 20 February 1997     

Changing fertility rates in developed countries. The impact of labor market institutions

During the last two decades fertility rates have decreased and have become positively correlated with female participation rates across OECD countries. I use a panel of 23 OECD nations to study how different labor market arrangements shaped these trends. High unemployment and unstable contracts, common in Southern Europe, depress fertility, particularly of younger women. To increase lifetime income though early skill-acquisition and minimize unemployment risk, young women postpone (or abandon) childbearing. Further, both a large share of public employment, by providing employment stability, and generous maternity benefits linked to previous employment, such as those in Scandinavia, boost fertility of the 25–29 and 30–34 year old women.Financial help from a CRB grant from the University of Illinois is gratefully acknowledged. I would like to thank Carles Boix, Barry Chiswick, Carmel Chiswick, Evelyn Lehrer, three anonymous referees and seminar participants at ESPE 2000 (Bonn), Illinois Economic Meetings 2000 (Chicago), Simposi dAnalisi Economica 2000 (Barcelona), 2001 Winter meetings of the Econometric Society in New Orleans, ESPE 2001 (Athens), Braga (Portugal), University of Chicago, De Paul University, PAA 2002 (Atlanta) for helpful comments; Gosta Esping-Andersen for providing some data and Cristina Mora for excellent research assistance. Responsible editor: Junsen Zhang.     

The fortunes of one's birth: Relative cohort size and the youth labor market in the United States

Using two different measures of relative cohort size – one indicating the size and placement of an individual's own birth cohort, and the other, the ratio of young to prime age adults in the United States in that year – it has been possible to isolate strong effects of the population age structure on wages in the United States over the past thirty-three years. These effects have been strong enough that virtually all of the observed change in the experience premium, and a substantial proportion of the changes in the college wage premium, can be explained by the relative cohort size variables alone. Even changes in the amount of within-group variance in wages appear to be largely a function of changing age structure, and absolute wage levels have been strongly affected by these demographic changes, suggesting that population growth can have positive effects on the economy. Received: 27 January 1998/Accepted: 6 June 1998     

Determinants of family migration: short moves vs. long moves

This paper examines factors underlying family migration. Based on a sample of stable Finnish families, both short- and long-distance migration is investigated. The empirical analysis carried out using multinomial logit modelling shows a strong negative association between the family life-cycle and migration. The findings indicate that migration takes place mainly due to the demands of the husbands career, resulting in the wives being tied migrants. Two-earner families are less migratory, and in that sense the husbands are tied stayers. Distance matters; several differences are noticed between short- and long-distance migrants.Financial support from the Yrjö Jahnsson Foundation (project no. 4271) is gratefully acknowledged. I would like to thank two anonymous referees for their helpful comments on this paper. I also wish to thank Kari Hälänen, Sari Pekkala and Hannu Tervo for their comments on an earlier version of this paper. Responsible editor: John F. Ermisch.     

The demand for nonrelative child care among families with infants and toddlers: A double-hurdle approach

Despite the increasing prevalence of nonparental child care, many parents in the United States care exclusively for their young children, even when both parents work. We examine reasons for non-consumption of child care by estimating double-hurdle, tobit and dominance models of the demand for nonrelative child care. Our results indicate that parents' decision whether to use any nonrelative child care is guided by different considerations than the decision of how much care to use. Furthermore, our findings are consistent with the hypothesis that some parents are not interested in nonrelative care, regardless of its price or nonmaternal income. Received: 27 January 2000/Accepted: 20 June 2001     

The future of sex mortality differentials in industrialized countries: A structural hypothesis

This paper advances the hypothesis that the future of sex mortality differentials in industrialized countries may depend on the future mortality rates of blue collar men. Data are presented to support the argument that mortality rates from ischemic heart disease for this population subgroup play a significant role in current differentials and, furthermore, that sexsocial class-mortality differentials correspond to social structural differences in protection against and/or exposure to health risks. Research and policy implications of this argument are addressed briefly.The views expressed in this paper are those of the authors and do not necessarily reflect the policy or views of the World Health Organization.     

A panel study of migration,self-selection and household real income

The impact of migration on income for Swedish multi-adult households is examined using panel data pertaining to a sample of stable household constellations during the period 1980–1990. In contrast to previous studies, data on household disposable income is employed in estimating the income function. The empirical results indicate no significant effect on real disposable income from migration. In addition, the hypothesis of no self-selection, or zero correlation between the errors in the decision function and the income function, cannot be rejected. Received: 10 May 1995 / Accepted: 14 August 1996     

The effect of immigration on wages in three european countries

We analyse the impact of immigrants on natives wages from reduced form wage equations for The Netherlands, United Kingdom and Norway. We find very small effects on natives wages and no dominant robust patterns of substitution and complementarity. Effects on earlier immigrants own wages are larger but less reliable. Further work should focus on these own effectsData on the Netherlands have been made available by CEREM, Statistics Netherlands(LSO 1997) and SEO (GPD). The British QLFS have been made available by the Office for National Statistics through the Data Archive, University of Essex. Norwegian KIRUT data have been made available by NSD, Bergen. We are grateful to these organisations. None of these organisations bear any responsibility for the analyses or interpretations of data sets used in this paper.Two anonymous referees and the editor-in-chief, Klaus Zimmermann, provided very valuable inputs for a substantial revision of an earlier draft. Responsible editor: Klaus F. Zimmermann.     

The employment adjustment of male immigrants in England

In this paper the employment performance of native and foreign born men in England is examined, using 1993–1994 data from the Quarterly Labour Force Survey of the United Kingdom. Chiswick's (1982) hypotheses of immigrant employment adjustment are investigated using logistic regression analysis. We show that there are interesting and important employment effects arising from immigrant characteristics. Recent white immigrants experience a transitory employment disadvantage. However non-white immigrants never attain employment equality with native born white men. Education, potential experience, family characteristics and country of birth are also found to be important determinants of employment. Received: 13 September 1998/Accepted: 15 July 1999     

Time for children: A study of parent's time allocation

The trade-off between parents' time with their own kids and market work, and its dependence on out-of-home day care is analyzed in a simultaneous equation framework. Economic incentives primarily work through decisions about market work, while the direct effects on time with children are weak. The results suggest that a change in the mother's working hours has less influence on the parents' time with their children than a change in the father's working hours. This would imply that a policy working to increase the time with people's own children should primarily influence the father's work hours. We also find that parents prefer joint activities with their children, and that out-of-home child care is not chosen as a substitute for own time with children. Received: 1 February 2000/Accepted: 22 May 2002 All correspondence to Daniel Hallberg. Helpful comments and suggestions from Henry Ohlsson and anonymous referees are gratefully acknowledged. We also appreciate comments from Martin Browning and seminar participants at Uppsala and Ume? universities. Financial support from the Swedish Council for Social Research (SFR) is gratefully acknowledged. Responsible editor: John F. Ermisch.     

A note on the changing relationship between fertility and female employment rates in developed countries

In this paper we look at a panel of OECD aggregate fertility and labor market data between 1970 and 1995 and we report some striking recent developments. Total Fertility Rates (TFR) were falling and Female Participation Rates (FPR) were increasing, conforming to a well known long-run trend. Along the cross-sectional dimension, the correlation between TFR and FPR was negative and significant during the 1970's and up to the early 1980's. This seemed consistent with secular comovements. However, by the late 1980's the correlation had become positive and equally significant. We discuss our findings within the framework of standard neoclassical models of fertility and labor supply adapted to macro data, as in Butz and Ward (1979). Received: 14 April 2000/Accepted: 29 December 2000 All correspondence to Pedro Mira. Namkee Ahn is grateful for financial support received from the Bank of Spain and from Spain's Ministerio de Educación y Cultura, grant SEC97-1249. We benefited from comments by two anonymous referees and by seminar participants at FEDEA, CEMFI and ESPE-98. All remaining errors are our own. Responsible editor: John F. Ermisch.     

The ageing of society, health services provision and taxes

This paper investigates the outcome of ageing on taxes and hospitalisation of the elderly using panel data on 23 Swedish county councils 1980–1999. We test two hypotheses; whether a larger share of elderly has no negative effect on bed days per elderly person and no positive effect on tax rates. We reject the first hypothesis but fail to reject the second hypothesis. Further we cannot reject the hypothesis of a unitary elasticity of the share of elderly on bed days per elderly person. These results imply that the old bear the entire cost of adjustment when the population grows older.     

Estimating the effects of immigration in one city

This paper presents a new method of estimating the effects of immigration on the labor market that does not require variations in immigration across cities. With a two-stage CES model that aggregates immigrant groups by age cohorts and aggregates cohorts into effective labor, the econometric estimation and the interpretation of parameters are particularly straightforward. The paper uses data from Hong Kong to estimate the elasticities of complementarity associated with increased immigration. A simulation study indicates that a 40% increase in the stock of new immigrants will lower wages by no more than one percent. Received: 13 August 1997/Accepted: 7 December 1998     

Self-selection,earnings, and out-migration: A longitudinal study of immigrants to Germany

In this paper we examine the process of out-migration and investigate whether cross-sectional earnings assimilation results suffer from selection bias due to out-migration. Our 14 year longitudinal study reveals that emigrants are negatively selected with respect to occupational prestige and to stable full time employment. Our results show no selectivity with respect to human capital or gender. The likelihood of return migration is strongly determined by the range and nature of social attachments to Germany and origin countries. It is also the highest during the first five years since arrival, and grows higher toward retirement. Selective emigration, however, does not appear to distort cross-sectional estimates of earnings assimilation in a relevant way.All Correspondence to Douglas S. Massey. This study has been made possible through various research visits to DIW Berlin and IZA in Bonn. We are grateful for the access to the data, and many useful comments on various drafts by Klaus F. Zimmermann. Earlier drafts were presented at the annual conference of the Population Association of America in Atlanta, and research seminars at Princeton University and IZA, Bonn. We wish to thank many participants for stimulating discussions and useful comments. We have benefitted in making revisions from the comments of three anonymous referees. Responsible editor: Klaus F. Zimmermann.     

The unemployment insurance compensation experience of immigrants in Canada, 1980-1988

This paper utilizes a new data set, compiled by Citizenship and Immigration Canada, Revenue Canada and Statistics Canada, to examine the unemployment experience of Canadian immigrant cohorts over the time period 1980 to 1988. Using the records of unemployment insurance benefits of persons who immigrated to Canada in those years and who filed income tax returns, the unemployment experiences of those people are compared by landing year, gender, level of education, language ability, and country of last permanent residence. The determinants of the proportion of each immigrant cohort that received unemployment insurance benefits are estimated by relating the proportions to landing year, duration of time in Canada, and labour market conditions. Briefly, we find no obvious influences on UI receipt behaviour following the immigration reforms of 1982. However, the recession of 1981–82 had a major impact on incomes which did not recover until 5 or 6 years later. Nevertheless, more generous UI benefits did raise slightly the likelihood of UI receipts. Received: 5 December 1995 / Accepted: 14 August 1996     

The effect of child care and part time opportunities on participation and fertility decisions in Italy

Economic models of household behavior typically yield the prediction that increases in schooling levels and wage rates of married women lead to increases in their labor supply and reductions in fertility. In Italy, low labor market participation rates of married women are observed together with low birth rates. Our explanation involves the Italian institutional structure, particularly as reflected in rigidities and imperfections in the labor market and characteristics of the publicly-funded child care system. These rigidities tend to simultaneously increase the costs of having children and to discourage the labor market participation of married women. We analyze a model of labor supply and fertility, using panel data. The empirical results show that the availability of child care and part time work increase both the probability of working and having a child. Received: 14 February 2000/Accepted: 20 February 2001     

A reply to Walker’s note: A comment on Taşiran’s ‘Wage and income effects on the timing and spacing of births in Sweden and in the United States’

Walker (1997) criticizes one of the conclusions in my book Tas?\iran (1995), that Heckman and Walker’s very high negative wage rate and positive income effects on Swedish fertility are very sensitive. In this paper, I explain, first, that my results are not only based on the series Walker mentions, but also on other series in both SFS and HUS data sets. Second, the combined aggregate and micro wage series he criticizes is mainly derived with Heckman and Walker. Third, by discussing the points he raises for the combination strategy, I show that his revised results are also supporting my conclusion. Received: 7 June 1996/Accepted: 16 July 1997 I am grateful to Anders Klevmarken, Lennart Hjalmarsson, Bj?rn Gustafsson and Ann Veiderpass for their valuable suggestions and discussions on an earlier version of this paper. Thanks also to two anonymous referees for their comments and to the responsible editor of this journal Klaus F. Zimmermann, for his encouragement and many helpful comments. Any remaining errors are my own. Responsible editor: Klaus F. Zimmermann.