Labor market structure and fertility differences among Puerto Rican women: The effects of economic and social policies on opportunity costs

The oft-observed inverse relationship between economic activity in the formal or informal sector and levels of fertility is attributed to the opportunity costs of reproduction. The economic and social policies that initiate and maintain the substantial flow of federal transfer payments to the Puerto Rican population is likely to reduce the opportunity costs among women participating in the informal economy; therefore, informal labor market participants will have fertility levels more like women who have never worked than like women active in the formal labor market. Using data from the 1982 Puerto Rican Fertility and Family Planning Assessment, this paper compares fertility differentials among ever-married women who have never worked, who have ever worked in the informal economy, and who have only worked in the formal economy. Contrary to expectations, the fertility levels of informal labor market participants are more like those of formal labor market participants; economic activity in either sector is associated with bearing fewer children. Federal transfer payments do not appear to reduce the opportunity costs of reproduction among women employed in the informal economy. An earlier version of this paper was presented at the 1989 meeting of the Population Association of America.