Income Distribution Dynamics with Endogenous Fertility
AbstractDeveloping countries with highly unequal income distributions, such as Brazil or South Africa, face an uphill battle in reducing inequality. Educated workers in these countries have a much lower birthrate than uneducated workers. Assuming children of educated workers are more likely to become educated, this fertility differential increases the proportion of unskilled workers, reducing their wages, and thus their opportunity cost of having children, creating a vicious cycle. A model incorporating this effect generates multiple steady-state levels of inequality, suggesting that in some circumstances, temporarily increasing access to educational opportunities could permanently reduce inequality. Empirical evidence suggests that the fertility differential between the educated and uneducated is greater in less equal countries, consistent with the model. Copyright 2002 by Kluwer Academic Publishers
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Bibliographic InfoArticle provided by Springer in its journal Journal of Economic Growth.
Volume (Year): 7 (2002)
Issue (Month): 3 (September)
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Web page: http://www.springerlink.com/link.asp?id=102931
Other versions of this item:
- Michael Kremer & Daniel Chen, 2000. "Income-distribution Dynamics with Endogenous Fertility," NBER Working Papers 7530, National Bureau of Economic Research, Inc.
- J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
- O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
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