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Does fertility decrease household consumption?

Author

Listed:
  • Jungho Kim

    (Korea Development Institute (KDI))

  • Henriette Engelhardt-Wölfler

    (Otto-Friedrich-Universität Bamberg)

  • Alexia Fürnkranz-Prskawetz

    (Max-Planck-Institut für Demografische Forschung)

  • Arnstein Aassve

    (Università Commerciale Luigi Bocconi)

Abstract

This paper presents an empirical analysis of the relationship between fertility and a direct measure of poverty for Indonesia, a country, which has experienced unprecedented economic growth and sharp fertility declines over recent decades. It focuses on illustrating the sensitivity of the effect of fertility on household consumption with respect to the equivalence scale by applying the propensity score matching method. The analysis suggests that a newborn child decreases household consumption per person by 20 percent within four years. When the estimates of equivalence scales implied by the Indonesian sample are applied, the effect of a child on household consumption is still negative, but the magnitudes are in the range from 20 to 65 percent of that found with the per-capita expenditure as a measure of consumption. Therefore, it is suggested that the analysis based on the conventional measure of poverty is likely to exaggerate the effect of fertility on poverty at least because of the neglect of the proper equivalence scale.

Suggested Citation

  • Jungho Kim & Henriette Engelhardt-Wölfler & Alexia Fürnkranz-Prskawetz & Arnstein Aassve, 2009. "Does fertility decrease household consumption?," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 20(26), pages 623-656, June.
  • Handle: RePEc:dem:demres:v:20:y:2009:i:26
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    File URL: http://www.demographic-research.org/volumes/vol20/26/20-26.pdf
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    References listed on IDEAS

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    Cited by:

    1. Van Campenhout, Bjorn, 2016. "Fertility, Agricultural Labor Supply, and Production: Instrumental Variable Evidence from Uganda," Agricultural and Resource Economics Review, Cambridge University Press, vol. 45(03), pages 581-607, December.

    More about this item

    Keywords

    consumption; equivalence scale; fertility; Indonesia; poverty dynamics;

    JEL classification:

    • J1 - Labor and Demographic Economics - - Demographic Economics
    • Z0 - Other Special Topics - - General

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