Structural Change and the Fertility Transition in the American South

This paper provides new insights on the link between structural change and the fertility transi-tion. In the early 1890s agricultural production in the American South was severely impaired by the spread of an agricultural pest, the boll weevil. We use this plausibly exogenous variation in agricultural production to establish a causal link between changes in earnings opportunities in agriculture and fertility. Our estimates show that lower earnings opportunities in agriculture lead to fewer children. We identify two channels: households staying in agriculture reduced fertility because children are a normal good, and households switching to manufacturing faced higher opportunity costs of raising children. The lower earnings opportunities in agriculture also stimulated human capital formation, which we argue is consistent with the predictions of a quantity-quality model of fertility.