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Do higher rents discourage fertility? Evidence from U.S. cities, 1940-2000

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  • Simon, Curtis J.
  • Tamura, Robert

Abstract

This paper documents the existence of a negative cross-sectional correlation between the price of living space as measured by rent per room and fertility using U.S. Census data over the period 1940-2000, the effect strengthening from 1940 to 1970 and weakening thereafter. The negative correlation does not merely reflect the tendency of larger families to locate within less-expensive areas of a given metropolitan area. Our study focuses on younger households, but analysis of completed fertility among older households reinforces the findings for younger households. Estimates for 36 CMSAs using the American Housing Survey, which permit us to construct persquare-foot measures of the price of living space, indicate that our findings are not merely an artifact of larger families occupying houses with more rooms. Durbin-Wu-Hausman tests reveal little evidence of endogeneity bias.

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Bibliographic Info

Article provided by Elsevier in its journal Regional Science and Urban Economics.

Volume (Year): 39 (2009)
Issue (Month): 1 (January)
Pages: 33-42

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Handle: RePEc:eee:regeco:v:39:y:2009:i:1:p:33-42

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Keywords: Fertility Housing prices Living arrangements;

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References

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  1. Jan K. Brueckner & Ann G. Largey, 2006. "Social Interaction and Urban Sprawl," CESifo Working Paper Series 1843, CESifo Group Munich.
  2. Edward L. Glaeser & Joseph Gyourko, 2005. "Urban Decline and Durable Housing," Journal of Political Economy, University of Chicago Press, vol. 113(2), pages 345-375, April.
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  4. repec:ese:iserwp:97-18 is not listed on IDEAS
  5. Haurin, Donald R & Hendershott, Patric H & Kim, Dongwook, 1993. "The Impact of Real Rents and Wages on Household Formation," The Review of Economics and Statistics, MIT Press, vol. 75(2), pages 284-93, May.
  6. Naz, Ghazala & Nilsen, Øivind Anti & Vagstad, Steinar, 2002. "Education and completed fertility in Norway," Working Papers in Economics 18/02, University of Bergen, Department of Economics.
  7. Jonathan Guryan, 2004. "Desegregation and Black Dropout Rates," American Economic Review, American Economic Association, vol. 94(4), pages 919-943, September.
  8. Schultz, T. Paul, 1993. "Demand for children in low income countries," Handbook of Population and Family Economics, in: M. R. Rosenzweig & Stark, O. (ed.), Handbook of Population and Family Economics, edition 1, volume 1, chapter 8, pages 349-430 Elsevier.
  9. Glaeser, Edward L & Gyourko, Joseph & Saks, Raven, 2005. "Why Is Manhattan So Expensive? Regulation and the Rise in Housing Prices," Journal of Law and Economics, University of Chicago Press, vol. 48(2), pages 331-69, October.
  10. DiPasquale, Denise, 1999. "Why Don't We Know More about Housing Supply?," The Journal of Real Estate Finance and Economics, Springer, vol. 18(1), pages 9-23, January.
  11. Borsch-Supan, Axel, 1986. "Household formation, housing prices, and public policy impacts," Journal of Public Economics, Elsevier, vol. 30(2), pages 145-164, July.
  12. Roback, Jennifer, 1982. "Wages, Rents, and the Quality of Life," Journal of Political Economy, University of Chicago Press, vol. 90(6), pages 1257-78, December.
  13. Ermisch, John, 1999. "Prices, Parents, and Young People's Household Formation," Journal of Urban Economics, Elsevier, vol. 45(1), pages 47-71, January.
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  15. Francisco Covas & J.M.C. Santos Silva, 2000. "A modified hurdle model for completed fertility," Journal of Population Economics, Springer, vol. 13(2), pages 173-188.
  16. Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119.
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Citations

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Cited by:
  1. Dettling, Lisa J. & Kearney, Melissa S., 2014. "House prices and birth rates: The impact of the real estate market on the decision to have a baby," Journal of Public Economics, Elsevier, vol. 110(C), pages 82-100.
  2. Hiroshi Aiura & Yasuhiro Sato, 2009. "A model of urban demography," Discussion Papers in Economics and Business 09-18-Rev, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP), revised Nov 2009.
  3. Tamura, Robert & Simon, Curtis J., 2012. "Secular fertility declines, baby booms and economic growth: international evidence," MPRA Paper 41669, University Library of Munich, Germany.
  4. Tamura, Robert & Simon, Curtis & Murphy, Kevin M., 2012. "Black and White Fertility, Differential Baby Booms: The Value of Civil Rights," MPRA Paper 40921, University Library of Munich, Germany.
  5. William A.V. Clark, 2012. "Do women delay family formation in expensive housing markets?," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 27(1), pages 1-24, July.
  6. Dan Black & Natalia Kolesnikova & Seth G. Sanders & Lowell J. Taylor, 2009. "Are children 'normal'?," Working Papers 2008-040, Federal Reserve Bank of St. Louis.

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