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The Early Bird gets the Worm? Birth Order Effects in a Dynamic Model of the Family

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Abstract

Birth order effects are found in empirical work, but lack theoretical foundations. Our new approach to modelling children provides this. Each child has the same genetic make-up and parents do not favour a child based on its birth order. Each child’s needs change as it grows, and births are sequential. At any point in time siblings are at different developmental stages, and the benefits of parental investment differ across these stages. Parental time investment in children lowers current and future wages; this opportunity cost varies across time. Birth order effects emerge from the interaction of the changing benefits and costs of parental investment.

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Bibliographic Info

Paper provided by Department of Economics, University of Victoria in its series Department Discussion Papers with number 0710.

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Length: 38 pages
Date of creation: 16 Dec 2007
Date of revision:
Handle: RePEc:vic:vicddp:0710

Note: ISSN 1914-2838
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Web page: http://web.uvic.ca/econ
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Keywords: Birth order; children; family;

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  1. Joseph Price, 2008. "Parent-Child Quality Time: Does Birth Order Matter?," Journal of Human Resources, University of Wisconsin Press, vol. 43(1).
  2. Becker, Gary S & Murphy, Kevin M, 1988. "A Theory of Rational Addiction," Journal of Political Economy, University of Chicago Press, vol. 96(4), pages 675-700, August.
  3. Becker, Gary S, 1974. "A Theory of Social Interactions," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1063-93, Nov.-Dec..
  4. Joshua D. Angrist & Victor Lavy & Analia Schlosser, 2005. "New Evidence on the Causal Link Between the Quantity and Quality of Children," NBER Working Papers 11835, National Bureau of Economic Research, Inc.
  5. Kessler, Daniel, 1991. "Birth Order, Family Size, and Achievement: Family Structure and Wage Determination," Journal of Labor Economics, University of Chicago Press, vol. 9(4), pages 413-26, October.
  6. Bergstrom, Theodore C & Cornes, Richard C, 1983. "Independence of Allocative Efficiency from Distribution in the Theory of Public Goods," Econometrica, Econometric Society, vol. 51(6), pages 1753-65, November.
  7. Becker, Gary S & Lewis, H Gregg, 1973. "On the Interaction between the Quantity and Quality of Children," Journal of Political Economy, University of Chicago Press, vol. 81(2), pages S279-88, Part II, .
  8. Ruhm, Christopher J., 2000. "Parental leave and child health," Journal of Health Economics, Elsevier, vol. 19(6), pages 931-960, November.
  9. Christopher J. Ruhm, 1998. "The Economic Consequences Of Parental Leave Mandates: Lessons From Europe," The Quarterly Journal of Economics, MIT Press, vol. 113(1), pages 285-317, February.
  10. Maxim Engers & Steven Stern, 2002. "Long-Term Care and Family Bargaining," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 43(1), pages 73-114, February.
  11. Michael Baker & Jonathan Gruber & Kevin Milligan, 2006. "Universal Childcare, Maternal Labor Supply, and Family Well-Being," Working Papers id:547, eSocialSciences.
  12. Nezih Guner & Jeremy Greenwood & John A. Knowles, 2000. "Women on Welfare: A Macroeconomic Analysis," American Economic Review, American Economic Association, vol. 90(2), pages 383-388, May.
  13. S Black & Paul Devereux & Kjell Salvanes, 2005. "The More the Merrier? The Effect of Family Size and Birth Order on Childrens Education," CEE Discussion Papers 0050, Centre for the Economics of Education, LSE.
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