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The Low Fertility Trap Hypothesis. Forces that May Lead to Further Postponement and Fewer Births in Europe

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  • Maria Rita Testa
  • Vegard Skirbekk
  • Wolfgang Lutz
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    Abstract

    This paper starts from the assessment that there is no good theory in the social sciences that would tell us whether fertility in low-fertility countries is likely to recover in the future, stay around its current level or continue to fall. This question is key to the discussion whether or not governments should take action aimed at influencing the fertility rate. To enhance the scholarly discussion in this field, the paper introduces a clearly defined hypothesis which describes plausible self-reinforcing mechanisms that would result, if unchecked, in a continued decrease of the number of births in the countries affected. This hypothesis has three components: a demographic one based on the negative population growth momentum, i.e., the fact that fewer potential mothers in the future will result in fewer births; a sociological one based on the assumption that ideal family size for the younger cohorts is declining as a consequence of the lower actual fertility they see in previous cohorts; and an economic one based on the first part of Easterlin’s (1980) relative income hypothesis, namely, that fertility results from the combination of aspirations and expected income, and assuming that aspirations of young adults are on an increasing trajectory while the expected income for the younger cohorts declines, partly as a consequence of population ageing induced by low fertility. All three factors would work towards a downward spiral in births in the future. If there is reason to assume that such mechanisms will indeed be at work, then this should strengthen the motivation of governments to take immediate action (possibly through policies addressing the tempo effect) in order to still escape from the expected trap.

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    File URL: http://epub.oeaw.ac.at/0xc1aa500d_0x00144e25
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    Bibliographic Info

    Article provided by Vienna Institute of Demography (VID) of the Austrian Academy of Sciences in Vienna in its journal Vienna Yearbook of Population Research.

    Volume (Year): 4 (2006)
    Issue (Month): 1 ()
    Pages: 167-192

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    Handle: RePEc:vid:yearbk:v:4:y:2006:i:1:p:167-192

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    Web page: http://www.oeaw.ac.at/vid/

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    References

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    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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    1. Fernández, Raquel & Fogli, Alessandra, 2005. "Fertility: The Role of Culture and Family Experience," CEPR Discussion Papers 5221, C.E.P.R. Discussion Papers.
    2. Maria Rita Testa & Leonardo Grilli, 2006. "The Influence of Childbearing Regional Contexts on Ideal Family Size in Europe," Population (english edition), Institut National d'Études Démographiques (INED), vol. 61(1), pages 99-127.
    3. Robert Shimer, 2001. "The Impact Of Young Workers On The Aggregate Labor Market," The Quarterly Journal of Economics, MIT Press, vol. 116(3), pages 969-1007, August.
    4. William Axinn & Marin Clarkberg & Arland Thornton, 1994. "Family influences on family size preferences," Demography, Springer, vol. 31(1), pages 65-79, February.
    5. Nordström Skans, Oskar, 2002. "Age effects in Swedish local labour markets," Working Paper Series 2002:11, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    6. Alois Stutzer, . "The Role of Income Aspirations in Individual Happiness," IEW - Working Papers 124, Institute for Empirical Research in Economics - University of Zurich.
    7. Wolfgang Lutz & Vegard Skirbekk, 2005. "Policies Addressing the Tempo Effect in Low-Fertility Countries," Population and Development Review, The Population Council, Inc., vol. 31(4), pages 699-720.
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    Cited by:
    1. Mizuki Komura, 2013. "Tax reform and endogenous gender bargaining power," Review of Economics of the Household, Springer, vol. 11(2), pages 175-192, June.

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