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What Accounts for the Emergence of Malthusian Fertility in Transition Economies?

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Author Info

  • Maja B. Micevska

    (Center for Development Research University of Bonn)

  • Paul J. Zak

    (Claremont Graduate University)

Abstract

The transition to market-oriented economies in Central and Eastern Europe and the former Soviet Union in the 1990s, like the Great Depression in the U.S. and Germany in the 1930s, generated sharp declines in real incomes and a corresponding drop in fertility. This is contrary to the robust negative relationship between income and fertility that has been extensively documented. This paper presents a theoretical model that explains the positive relationship between fertility and income. The model predicts that: i) the perceived level of subsistence consumption fundamentally determines whether fertility and income are positively or negatively related; ii) once incomes decline below a threshold, declining labor income causes fertility to fall; and iii) rising income inequality has a negative impact on fertility rates. Empirical tests using both aggregate and microeconomic data provide strong support for the predictions of the model. Our empirics predict that the perceived subsistence level is a statistically significant determinant of fertility and that the average country in our sample will remain in a Mathusian fertility regime for twenty more years.

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Bibliographic Info

Paper provided by Claremont Colleges in its series Claremont Colleges Working Papers with number 2002-01.

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Date of creation: Feb 2002
Date of revision:
Handle: RePEc:clm:clmeco:2002-01

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Keywords: Fertility; Subsistence Consumption; Transition;

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References

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  1. Barro, Robert J, 1991. "Economic Growth in a Cross Section of Countries," The Quarterly Journal of Economics, MIT Press, vol. 106(2), pages 407-43, May.
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  4. Oded Galor & Joseph Zeira, 2013. "Income Distribution and Macroeconomics," Working Papers 2013-12, Brown University, Department of Economics.
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Citations

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Cited by:
  1. Larry E. Jones & Michele Tertilt, 2006. "An Economic History of Fertility in the U.S.: 1826-1960," NBER Working Papers 12796, National Bureau of Economic Research, Inc.
  2. Mustafa Seref Akin & Valerica Vlad, 2007. "No Eastern and Central European left behind: a cross country regression for fertility, human capital and market economy," Journal of International Development, John Wiley & Sons, Ltd., vol. 19(7), pages 963-974.
  3. Heinrich Hock & David N. Weil, 2006. "The Dynamics of the Age Structure, Dependency, and Consumption," NBER Working Papers 12140, National Bureau of Economic Research, Inc.
  4. Grogan, L., 2002. "What Caused the Post-Transition Fertility Decline in Central and Eastern Europe and the Former Soviet Union?," Working Papers 2002-5, University of Guelph, Department of Economics and Finance.
  5. Sumon K. Bhaumik & Jeffrey B. Nugent, 2002. "Does economic uncertainty have an impact on decisions to bear children? Evidence from Eastern Germany," MPIDR Working Papers WP-2002-037, Max Planck Institute for Demographic Research, Rostock, Germany.

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