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Female Relative Wages, Household Specialization and Fertility

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  • Christian Siegel

    (University of Kent)

Abstract

Falling fertility rates have often been linked to rising female wages. However, over the last 40 years the US total fertility rate has been rather stable while female wages have continued to grow. Over the same period, women's hours spent on housework have declined, but men's have increased. I propose a model in which households are not perfectly specialized, but both men and women contribute to home production. As the gender wage gap narrows, the time allocations of men and women converge, and while fertility falls at first, the decline stops when female wages are close to male's. Rising relative wages increase women's labor supply and due to higher opportunity cost lower fertility at first, but they also lead to a reallocation of home production and child care from women to men, and a marketization. I find that both are important in understanding why fertility did not decline further. In a further quantitative exercise I show that the model performs well in matching fertility over the entire 20th century, including the overall decline, the baby boom, and the recent stabilization. (Copyright: Elsevier)

Suggested Citation

  • Christian Siegel, 2017. "Female Relative Wages, Household Specialization and Fertility," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 24, pages 152-174, March.
  • Handle: RePEc:red:issued:14-325
    DOI: 10.1016/j.red.2017.01.010
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    References listed on IDEAS

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    1. repec:eee:eecrev:v:115:y:2019:i:c:p:221-241 is not listed on IDEAS
    2. repec:dem:demres:v:40:y:2019:i:50 is not listed on IDEAS
    3. Michael Bar & Moshe Hazan & Oksana Leukhina & David Weiss & Hosny Zoabi, 2018. "Why did rich families increase their fertility? Inequality and marketization of child care," Journal of Economic Growth, Springer, vol. 23(4), pages 427-463, December.
    4. Laun, Tobias & Wallenius, Johanna, 2017. "Having It All? Employment, Earnings and Children," Working Paper Series 2017:6, Uppsala University, Department of Economics.
    5. Bar, Michael & Hazan, Moshe & Leukhina, Oksana & Weiss, David & Zoabi, Hosny, 2017. "Is The Market Pronatalist? Inequality, Differential Fertility, and Growth Revisited," CEPR Discussion Papers 12376, C.E.P.R. Discussion Papers.
    6. Pierre-Richard Agénor, 2018. "A Theory of Social Norms, Women's Time Allocation, and Gender Inequality in the Process of Development," Centre for Growth and Business Cycle Research Discussion Paper Series 237, Economics, The Univeristy of Manchester.

    More about this item

    Keywords

    Fertility; Female labor supply; Household production; Intrahousehold allocations;

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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