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The Life Cycle Model of the Fertility Choice in Hungary

Author

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  • Petra Németh

    (Corvinus University of Budapest)

Abstract

In this paper, we model the Hungarian fertility choice at the micro level. We outline a life cycle model in which a representative family makes decisions on its number of children, the timing of having children and the mother’s return to work after having children over the course of its life cycle. In constructing the model, we incorporate the factors influencing the decision to have children (with a particular emphasis on the family benefits scheme between 2006–2014) and how the behaviours of various household types (in terms of qualifications) differ from each other. According to the simulation results, among the family support tools presented, the family tax allowance scheme introduced in 2011 has a significant impact on the final number of children, maternal age and the timing of childbearing among low and medium education families. The measures introduced in 2014 provide incentive to have three children in all educational groups and foster the early labour market return of mothers. To our knowledge, no similar modelling attempts have been made so far in the Hungarian literature.

Suggested Citation

  • Petra Németh, 2017. "The Life Cycle Model of the Fertility Choice in Hungary," Financial and Economic Review, Magyar Nemzeti Bank (Central Bank of Hungary), vol. 16(4), pages 5-35.
    • Handle: RePEc:mnb:finrev:v:16:y:2017:i:4:p:5-35
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    References listed on IDEAS

    as
    1. Alexander Bick, 2010. "The Quantitative Role of Child Care for Fertility and Female Labor Force Participation," 2010 Meeting Papers 892, Society for Economic Dynamics.
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    3. Michael P. Keane & Kenneth I. Wolpin, 2010. "The Role Of Labor And Marriage Markets, Preference Heterogeneity, And The Welfare System In The Life Cycle Decisions Of Black, Hispanic, And White Women," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 51(3), pages 851-892, August.
    4. Karoly Fazekas & Julia Varga (ed.), 2015. "The Hungarian Labour Market 2015," The Hungarian Labour Market Yearbooks, Institute of Economics, Centre for Economic and Regional Studies, number 2015, December.
    5. Orazio Attanasio & Hamish Low & Virginia Sánchez-Marcos, 2008. "Explaining Changes in Female Labor Supply in a Life-Cycle Model," American Economic Review, American Economic Association, vol. 98(4), pages 1517-1552, September.
    6. Hans Fehr & Daniela Ujhelyiova, 2013. "Fertility, Female Labor Supply, and Family Policy," German Economic Review, Verein für Socialpolitik, vol. 14(2), pages 138-165, May.
    7. Larry E. Jones & Alice Schoonbroodt & Michèle Tertilt, 2010. "Fertility Theories: Can They Explain the Negative Fertility-Income Relationship?," NBER Chapters, in: Demography and the Economy, pages 43-100, National Bureau of Economic Research, Inc.
    8. Marco Francesconi, 2002. "A Joint Dynamic Model of Fertility and Work of Married Women," Journal of Labor Economics, University of Chicago Press, vol. 20(2), pages 336-380, Part.
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    More about this item

    Keywords

    childbearing; family support; life cycle model;
    All these keywords.

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy

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