IDEAS home Printed from https://ideas.repec.org/a/eee/deveco/v120y2016icp1-16.html
   My bibliography  Save this article

The value of children: Inter-generational support, fertility, and human capital

Author

Listed:
  • Oliveira, Jaqueline

Abstract

This paper offers robust empirical evidence of a Darwinian pro-natalist mechanism: parents can improve their old-age support with an additional child. Using the incidence of first-born twins as an instrument for fertility outcomes, I find that Chinese senior parents with more children receive more financial transfers and are more likely to co-reside with an adult child. They are also less likely to work past retirement age. The estimated effects are large, despite the evidence that adult children from larger families are less educated and earn significantly less. Interestingly, the effect of an increase in the number of children on old-age support does not depend on the child's gender.

Suggested Citation

  • Oliveira, Jaqueline, 2016. "The value of children: Inter-generational support, fertility, and human capital," Journal of Development Economics, Elsevier, vol. 120(C), pages 1-16.
  • Handle: RePEc:eee:deveco:v:120:y:2016:i:c:p:1-16
    DOI: 10.1016/j.jdeveco.2015.12.002
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0304387815001340
    Download Restriction: Full text for ScienceDirect subscribers only

    File URL: https://libkey.io/10.1016/j.jdeveco.2015.12.002?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Rosenzweig, Mark R & Wolpin, Kenneth I, 1980. "Life-Cycle Labor Supply and Fertility: Causal Inferences from Household Models," Journal of Political Economy, University of Chicago Press, vol. 88(2), pages 328-348, April.
    2. Cruces, Guillermo & Galiani, Sebastian, 2007. "Fertility and female labor supply in Latin America: New causal evidence," Labour Economics, Elsevier, vol. 14(3), pages 565-573, June.
    3. Mark R. Rosenzweig & Junsen Zhang, 2009. "Do Population Control Policies Induce More Human Capital Investment? Twins, Birth Weight and China's "One-Child" Policy," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 76(3), pages 1149-1174.
    4. Mark Rosenzweig & Junsen Zhang, 2014. "Co-residence, Life-Cycle Savings and Inter- Generational Support in Urban China," Working Papers 1039, Economic Growth Center, Yale University.
    5. Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2010. "Small Family, Smart Family? Family Size and the IQ Scores of Young Men," Journal of Human Resources, University of Wisconsin Press, vol. 45(1).
    6. Hongbin Li & Junsen Zhang & Yi Zhu, 2008. "The quantity-Quality trade-Off of children In a developing country: Identification using chinese twins," Demography, Springer;Population Association of America (PAA), vol. 45(1), pages 223-243, February.
    7. Francisca M. Antman, 2012. "Elderly Care and Intrafamily Resource Allocation when Children Migrate," Journal of Human Resources, University of Wisconsin Press, vol. 47(2), pages 331-363.
    8. Cai, Fang & Giles, John & Meng, Xin, 2006. "How well do children insure parents against low retirement income? An analysis using survey data from urban China," Journal of Public Economics, Elsevier, vol. 90(12), pages 2229-2255, December.
    9. Julio Cáceres-Delpiano, 2006. "The Impacts of Family Size on Investment in Child Quality," Journal of Human Resources, University of Wisconsin Press, vol. 41(4).
    10. Shang-Jin Wei & Xiaobo Zhang, 2011. "The Competitive Saving Motive: Evidence from Rising Sex Ratios and Savings Rates in China," Journal of Political Economy, University of Chicago Press, vol. 119(3), pages 511-564.
    11. Wei Huang & Xiaoyan Lei & Yaohui Zhao, 2016. "One-Child Policy and the Rise of Man-Made Twins," The Review of Economics and Statistics, MIT Press, vol. 98(3), pages 467-476, July.
    12. Willis, Robert J, 1973. "A New Approach to the Economic Theory of Fertility Behavior," Journal of Political Economy, University of Chicago Press, vol. 81(2), pages 14-64, Part II, .
    13. Imbens, Guido W & Angrist, Joshua D, 1994. "Identification and Estimation of Local Average Treatment Effects," Econometrica, Econometric Society, vol. 62(2), pages 467-475, March.
    14. Rosenzweig, Mark R & Wolpin, Kenneth I, 1980. "Testing the Quantity-Quality Fertility Model: The Use of Twins as a Natural Experiment," Econometrica, Econometric Society, vol. 48(1), pages 227-240, January.
    15. Coeurdacier, Nicolas & Jin, Keyu & Choukhmane, Taha, 2013. "The One-Child Policy and Household Savings," CEPR Discussion Papers 9688, C.E.P.R. Discussion Papers.
    16. Rupa Chakrabarti, 1999. "Endogenous fertility and growth in a model with old age support," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 13(2), pages 393-416.
    17. Schultz, T. Paul, 1993. "Demand for children in low income countries," Handbook of Population and Family Economics, in: M. R. Rosenzweig & Stark, O. (ed.), Handbook of Population and Family Economics, edition 1, volume 1, chapter 8, pages 349-430, Elsevier.
    18. Hiedemann, Bridget & Stern, Steven, 1999. "Strategic play among family members when making long-term care decisions," Journal of Economic Behavior & Organization, Elsevier, vol. 40(1), pages 29-57, September.
    19. Xiaoyu Wu & Lixing Li, 2014. "The Motives Of Intergenerational Transfer To The Elderly Parents In China: Consequences Of High Medical Expenditure," Health Economics, John Wiley & Sons, Ltd., vol. 23(6), pages 631-652, June.
    20. repec:dau:papers:123456789/13781 is not listed on IDEAS
    21. Schultz, T. Paul, 2008. "Population Policies, Fertility, Women's Human Capital, and Child Quality," Handbook of Development Economics, in: T. Paul Schultz & John A. Strauss (ed.), Handbook of Development Economics, edition 1, volume 4, chapter 52, pages 3249-3303, Elsevier.
    22. Hanushek, Eric A, 1992. "The Trade-Off between Child Quantity and Quality," Journal of Political Economy, University of Chicago Press, vol. 100(1), pages 84-117, February.
    23. Yuyu Chen & Hongbin Li & Lingsheng Meng, 2013. "Prenatal Sex Selection and Missing Girls in China: Evidence from the Diffusion of Diagnostic Ultrasound," Journal of Human Resources, University of Wisconsin Press, vol. 48(1), pages 36-70.
    24. Angrist, Joshua D & Evans, William N, 1998. "Children and Their Parents' Labor Supply: Evidence from Exogenous Variation in Family Size," American Economic Review, American Economic Association, vol. 88(3), pages 450-477, June.
    25. Nikhil Roy & Andrew D. Foster, 1996. "The Dynamics of Education and Fertility: Evidence from a Family Planning Experiment"," Home Pages _073, University of Pennsylvania.
    26. Dewen Wang, 2006. "China's Urban and Rural Old Age Security System: Challenges and Options," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 14(1), pages 102-116, February.
    27. Roméo Fontaine & Agnès Gramain & Jérôme Wittwer, 2009. "Providing care for an elderly parent: interactions among siblings?," Health Economics, John Wiley & Sons, Ltd., vol. 18(9), pages 1011-1029, September.
    28. Nistha Sinha, 2003. "Fertility, Child Work and Schooling Consequences of Family Planning Programs: Evidence from an Experiment in Rural Bangladesh," Working Papers 867, Economic Growth Center, Yale University.
    29. Gary S. Becker & Robert J. Barro, 1988. "A Reformulation of the Economic Theory of Fertility," The Quarterly Journal of Economics, Oxford University Press, vol. 103(1), pages 1-25.
    30. Michele Boldrin & Larry E. Jones, 2002. "Mortality, Fertility, and Saving in a Malthusian Economy," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 5(4), pages 775-814, October.
    31. Grant Miller, 2005. "Contraception as Development? New Evidence from Family Planning in Colombia," NBER Working Papers 11704, National Bureau of Economic Research, Inc.
    32. Nancy Qian, 2009. "Quantity-Quality and the One Child Policy:The Only-Child Disadvantage in School Enrollment in Rural China," NBER Working Papers 14973, National Bureau of Economic Research, Inc.
    33. Rosenzweig, Mark R. & Paul Schultz, T., 1987. "Fertility and investments in human capital : Estimates of the consequence of imperfect fertility control in Malaysia," Journal of Econometrics, Elsevier, vol. 36(1-2), pages 163-184.
    34. Joyce P. Jacobsen & James Wishart Pearce III & Joshua L. Rosenbloom, 1999. "The Effects of Childbearing on Married Women's Labor Supply and Earnings: Using Twin Births as a Natural Experiment," Journal of Human Resources, University of Wisconsin Press, vol. 34(3), pages 449-474.
    35. Franco Modigliani & Shi Larry Cao, 2004. "The Chinese Saving Puzzle and the Life-Cycle Hypothesis," Journal of Economic Literature, American Economic Association, vol. 42(1), pages 145-170, March.
    36. Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2005. "The More the Merrier? The Effect of Family Size and Birth Order on Children's Education," The Quarterly Journal of Economics, Oxford University Press, vol. 120(2), pages 669-700.
    37. Gary S. Becker & H. Gregg Lewis, 1974. "Interaction between Quantity and Quality of Children," NBER Chapters, in: Economics of the Family: Marriage, Children, and Human Capital, pages 81-90, National Bureau of Economic Research, Inc.
    38. Joshua Angrist & Victor Lavy & Analia Schlosser, 2010. "Multiple Experiments for the Causal Link between the Quantity and Quality of Children," Journal of Labor Economics, University of Chicago Press, vol. 28(4), pages 773-824, October.
    39. Sinha, Nistha, 2003. "Fertility, Child Work and Schooling Consequences of Family Planning Programs: Evidence from an Experiment in Rural Bangladesh," Center Discussion Papers 28457, Yale University, Economic Growth Center.
    40. Bronars, Stephen G & Grogger, Jeff, 1994. "The Economic Consequences of Unwed Motherhood: Using Twin Births as a Natural Experiment," American Economic Review, American Economic Association, vol. 84(5), pages 1141-1156, December.
    41. Kam Wing Chan, 2010. "The Household Registration System and Migrant Labor in China: Notes on a Debate," Population and Development Review, The Population Council, Inc., vol. 36(2), pages 357-364, June.
    42. repec:dau:papers:123456789/1879 is not listed on IDEAS
    43. Julio Cáceres-Delpiano, 2012. "Can We Still Learn Something From the Relationship Between Fertility and Mother’s Employment? Evidence From Developing Countries," Demography, Springer;Population Association of America (PAA), vol. 49(1), pages 151-174, February.
    44. David Byrne & Michelle S. Goeree & Bridget Hiedemann & Steven Stern, 2009. "Formal Home Health Care, Informal Care, And Family Decision Making," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 50(4), pages 1205-1242, November.
    45. Grant Miller, 2005. "Contraception as Development? New Evidence from Family Planning in Colombia," CID Working Papers 9, Center for International Development at Harvard University.
    46. Raut, L K & Srinivasan, T N, 1994. "Dynamics of Endogenous Growth," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 4(5), pages 777-790, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Damian Clarke, 2018. "Children And Their Parents: A Review Of Fertility And Causality," Journal of Economic Surveys, Wiley Blackwell, vol. 32(2), pages 518-540, April.
    2. Jaqueline Oliveira, 2019. "Birth order and the gender gap in educational attainment," Review of Economics of the Household, Springer, vol. 17(3), pages 775-803, September.
    3. Sonia Bhalotra & Damian Clarke, 2019. "Twin Birth and Maternal Condition," The Review of Economics and Statistics, MIT Press, vol. 101(5), pages 853-864, December.
    4. Schultz, T. Paul, 2010. "Population and Health Policies," Handbook of Development Economics, in: Dani Rodrik & Mark Rosenzweig (ed.), Handbook of Development Economics, edition 1, volume 5, chapter 0, pages 4785-4881, Elsevier.
    5. Chen, Qihui, 2021. "Population policy, family size and child malnutrition in Vietnam – Testing the trade-off between child quantity and quality from a child nutrition perspective," Economics & Human Biology, Elsevier, vol. 41(C).
    6. Semih Tumen & Belgi Turan, 2023. "The effect of fertility on female labor supply in a labor market with extensive informality," Empirical Economics, Springer, vol. 65(4), pages 1855-1894, October.
    7. Cáceres-Delpiano, Julio & Simonsen, Marianne, 2012. "The toll of fertility on mothers’ wellbeing," Journal of Health Economics, Elsevier, vol. 31(5), pages 752-766.
    8. Jose Maria Cabrera, 2011. "Fecundidad e Ingresos en Uruguay," Documentos de Trabajo/Working Papers 1110, Facultad de Ciencias Empresariales y Economia. Universidad de Montevideo..
    9. Chen, Qihui, 2017. "Relaxed population policy, family size and parental investments in children’s education in rural Northwestern China," International Journal of Educational Development, Elsevier, vol. 54(C), pages 39-50.
    10. Peng, Fei & Anwar, Sajid & Kang, Lili, 2022. "Number of siblings, access to treated water and returns to education in China," Economic Analysis and Policy, Elsevier, vol. 74(C), pages 526-538.
    11. Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2010. "Small Family, Smart Family? Family Size and the IQ Scores of Young Men," Journal of Human Resources, University of Wisconsin Press, vol. 45(1).
    12. Jingdong Zhong & Jingjing Gao & Chengfang Liu & Jie Huang & Renfu Luo, 2019. "Quantity–Quality Trade-Off and Early Childhood Development in Rural Family: Evidence from China’s Guizhou Province," IJERPH, MDPI, vol. 16(7), pages 1-29, April.
    13. Jianmei ZHAO & Hai ZHONG, 2019. "A Demographic Factor as a Determinant of Migration: What Is the Effect of Sibship Size on Migration Decision?," JODE - Journal of Demographic Economics, Cambridge University Press, vol. 85(4), pages 321-345, December.
    14. Baez, Javier E., 2008. "Does More Mean Better? Sibling Sex Composition and the Link between Family Size and Children’s Quality," IZA Discussion Papers 3472, Institute of Labor Economics (IZA).
    15. Joseph Boniface Ajefu, 2019. "Does having children affect women’s entrepreneurship decision? Evidence from Nigeria," Review of Economics of the Household, Springer, vol. 17(3), pages 843-860, September.
    16. Christina J. Diaz & Jeremy E. Fiel, 2021. "When Size Matters: IV Estimates of Sibship Size on Educational Attainment in the U.S," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 40(6), pages 1195-1220, December.
    17. Dasgupta, Kabir & Solomon, Keisha T., 2018. "Family size effects on childhood obesity: Evidence on the quantity-quality trade-off using the NLSY," Economics & Human Biology, Elsevier, vol. 29(C), pages 42-55.
    18. Guo, Rufei & Yi, Junjian & Zhang, Junsen, 2017. "Family size, birth order, and tests of the quantity–quality model," Journal of Comparative Economics, Elsevier, vol. 45(2), pages 219-224.
    19. Li, Honghui & Hiwatari, Masato, 2020. "Family Size and Educational Attainment : The Case of China," Discussion paper series. A 353, Graduate School of Economics and Business Administration, Hokkaido University.
    20. Cáceres-Delpiano, Julio, 2008. "Keeping the best for last. Impact of fertility on mother's employment. Evidence from developing countries," UC3M Working papers. Economics we086832, Universidad Carlos III de Madrid. Departamento de Economía.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:deveco:v:120:y:2016:i:c:p:1-16. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/devec .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.