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Employment and Fertility Choice: A Differential Game Approach

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  • Le Wang

    ()
    (University of Minnesota)

  • Joao Ricardo Faria

    ()
    (University of Texas Pan American)

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Abstract

For OECD countries there is an intriguing variety of combinations between total fertility rate (TFR) and female labor force participation rate (FPR) suggesting the existence of multiple equilibria. This paper provides a differential game framework where the employment choices by husband and wife affect a family's fertility. The model has multiple open-loop equilibria characterized by different combinations of FPR and TFR that are consistent with the empirical cross-country evidence. The dynamic trajectory from one equilibrium point to another also sheds lights on possible demographic transition of individual countries as displayed in their time series data. The model stresses that the husband's employment decisions are as important as wife's in determining family size.

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File URL: http://www.accessecon.com/pubs/EB/2007/Volume10/EB-07J00004A.pdf
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Bibliographic Info

Article provided by AccessEcon in its journal Economics Bulletin.

Volume (Year): 10 (2007)
Issue (Month): 9 ()
Pages: 1-8

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Handle: RePEc:ebl:ecbull:eb-07j00004

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  1. George A. Akerlof & Rachel E. Kranton, 2000. "Economics And Identity," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 715-753, August.
  2. Namkee Ahn & Pedro Mira, . "A note on the changing relationship between fertility and female employment rates in developed countries," Studies on the Spanish Economy 13, FEDEA.
  3. Bergstrom, T., 1995. "Economics of a Family Way," Papers 95-07, Michigan - Center for Research on Economic & Social Theory.
  4. Shelly Lundberg & Robert A. Pollak, 1996. "Bargaining and Distribution in Marriage," Journal of Economic Perspectives, American Economic Association, vol. 10(4), pages 139-158, Fall.
  5. Bettio, Francesca & Villa, Paola, 1998. "A Mediterranean Perspective on the Breakdown of the Relationship between Participation and Fertility," Cambridge Journal of Economics, Oxford University Press, vol. 22(2), pages 137-71, March.
  6. Francesc Ortega & Ryuichi Tanaka, 2007. "Gender specialization in households: An empirical analysis," Economics Working Papers 1021, Department of Economics and Business, Universitat Pompeu Fabra.
  7. Jacob Mincer, 1962. "Labor Force Participation of Married Women: A Study of Labor Supply," NBER Chapters, in: Aspects of Labor Economics, pages 63-106 National Bureau of Economic Research, Inc.
  8. Ted Bergstrom, 1995. "Economic in a Family Way," Papers _028, University of Michigan, Department of Economics.
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