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How do epidemics induce behavioral changes?

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Author Info
BOUCEKKINE, Raouf (UniversitŽ catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE))
DESBORDES, Rodolphe
LATZER, HŽlne

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Abstract

This paper develops a theory of optimal fertility behavior under mortality shocks. In a 3- periods OLG model, young adults determine their optimal fertility, labor supply and life-cycle consumption with both exogenous child and adult mortality risks. For fixed prices (real wages and interest rate), it is shown that both child and adult one-period mortality shocks raise fertility due to insurance and life-cycle mechanisms respectively. In general equilibrium, adult mortality shocks give rise to price effects (notably through rising wages) lowering fertility, in contrast to child mortality shocks. We complement our theory with an empirical analysis on a sample of 39 Sub-Saharan African countries over the 1980-2004 period, checking for the overall effects of the adult and child mortality channels on optimal fertility behavior. We find child mortality to exert a robust, positive impact on fertility, whereas the reverse is true for adult mortality. We further find this negative effect on fertility of a rise in adult mortality to dominate in the long-term the positive effect on demand for children resulting from an increase in child mortality.

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Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 2008042.

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Date of creation: 01 Jul 2008
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Handle: RePEc:cor:louvco:2008042

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Related research
Keywords: fertility; mortality; epidemics; HIV;

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Find related papers by JEL classification:
J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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Cited by:
(explanations, 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.)

  1. Matteo Cervellati & Uwe Sunde, 2008. "The Economic and Demographic Transition, Mortality, and Comparative Development," University of St. Gallen Department of Economics working paper series 2008 2008-21, Department of Economics, University of St. Gallen. [Downloadable!]
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