Endogenous Fertility and the Effects of Foreign Aid
AbstractAn overlapping generations framework is employed in order to study consequences of the old-age security and producer goods motive for having children in a rural economy. The model predicts growth in total output combined with declining fertility and increasing population density and per capita output, if landholdings are initially greater than in stationary state. An increase in agricultural productivity, a decrease in the cost of raising children, and a transfer to adults increase fertility in the short run, while a transfer to the old decrease it. In stationary state, permanent positive productivity shifts cause higher population density but leave per capita consumption unchanged. Permanent reductions in the cost of raising children and permanent increases in transfers to adults reduce per capita consumption and increase population density, while permanent increases in transfers to the old have the opposite effect in the new stationary state.
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Bibliographic InfoPaper provided by Stockholm School of Economics in its series Working Paper Series in Economics and Finance with number 27.
Length: 32 pages
Date of creation: Nov 1994
Date of revision:
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Postal: The Economic Research Institute, Stockholm School of Economics, P.O. Box 6501, 113 83 Stockholm, Sweden
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Endogenous fertility; foreign aid; population old age security;
Find related papers by JEL classification:
- J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
- O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
- Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
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