Value of Children and the social production of welfare

Background: The paper describes the origins of the Value of Children (VOC) approach to the cross-cultural research on fertility behavior around the Pacific Rim, and critically discusses its shortcomings at this stage. Objective: The paper then demonstrates how the approach derives its theoretical coherence from the theory of social production functions, making reference to empirical evidence. Results: The VOC approach combines a multi-level and action-oriented theoretical model of generative behavior based on the principles of methodological individualism with the welfare maximizing assumptions derived from social production function theory, to create a comprehensive explanatory program. Conclusions: The VOC approach extends economic theories of fertility:Whereas traditional economic theories emphasize the costs of children, the VOC approach also encompasses the supply side of children, i.e., the benefits children bring to their (potential) parents under variable social and economic conditions. Comments: The paper outlines future extensions of the VOC approach. The question here is if and to what extent the production of social welfare through parenthood is substitutable by other production modes, and whether children as intermediate goods compete or are complemented by welfare production in other life domains.