IDEAS home Printed from https://ideas.repec.org/p/edb/cedidp/06-06.html
   My bibliography  Save this paper

Does Economic Uncertainty Affect the Decision to Bear Children? Evidence from East and West Germany

Author

Listed:
  • Sumon Kumar Bhaumik

    ()

  • Jeffrey B. Nugent

Abstract

During their social, political and economic transition, the countries of Central and Eastern Europe experienced significant economic uncertainty. Many of these countries also experienced sharply falling fertility rates. There have been some suggestions that that these two phenomena are linked, i.e., that uncertainty has an impact of the decision to bear children. But the strength and nature of this relationship has not been examined carefully. This paper demonstrates the existence of such a link at the micro level using two different types of uncertainty measures based on GSOEP data from Eastern (and for comparison purposes also Western) Germany for the years 1992-2002. The results suggest that employment uncertainty (but not financial uncertainty) was considerably greater in Eastern Germany during its post-reunification transition than in Western Germany and had a highly nonlinear effect on the likelihood of childbirth. We also show that this uncertainty may have contributed significantly to the sharp drop in East Germany’s total fertility rate in the immediate aftermath of the reunification.

Suggested Citation

  • Sumon Kumar Bhaumik & Jeffrey B. Nugent, 2006. "Does Economic Uncertainty Affect the Decision to Bear Children? Evidence from East and West Germany," CEDI Discussion Paper Series 06-06, Centre for Economic Development and Institutions(CEDI), Brunel University.
  • Handle: RePEc:edb:cedidp:06-06
    as

    Download full text from publisher

    File URL: http://www.brunel.ac.uk/__data/assets/pdf_file/0011/342668/CEDI_06-06.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Avinash K. Dixit & Robert S. Pindyck, 1994. "Investment under Uncertainty," Economics Books, Princeton University Press, edition 1, number 5474, June.
    2. Tomás Sobotka, 2004. "Is Lowest-Low Fertility in Europe Explained by the Postponement of Childbearing?," Population and Development Review, The Population Council, Inc., vol. 30(2), pages 195-220.
    3. Engelhardt, Gary V. & Mayer, Christopher J., 1998. "Intergenerational Transfers, Borrowing Constraints, and Saving Behavior: Evidence from the Housing Market," Journal of Urban Economics, Elsevier, vol. 44(1), pages 135-157, July.
    4. Lechner, Michael, 1997. "Eine empirische Analyse der Geburtenentwicklung in den neuen Bundesländern," Discussion Papers 551, Institut fuer Volkswirtschaftslehre und Statistik, Abteilung fuer Volkswirtschaftslehre.
    5. Liliana E. Pezzin & Barbara Steinberg Schone, 1999. "Intergenerational Household Formation, Female Labor Supply and Informal Caregiving: A Bargaining Approach," Journal of Human Resources, University of Wisconsin Press, vol. 34(3), pages 475-503.
    6. Witte, James C. & Wagner, Gert G., 1995. "Declining Fertility in East Germany After Unification: A Demographic Response to Socioeconomic Change," EconStor Open Access Articles, ZBW - German National Library of Economics, pages 387-397.
    7. Angelika Tölke & Martin Diewald, 2003. "Insecurities in employment and occupational careers and their impact on the transition to fatherhood in Western Germany," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 9(3), pages 41-68, September.
    8. Bonin, Holger & Euwals, Rob, 2001. "Participation Behavior of East German Women after German Unification," IZA Discussion Papers 413, Institute for the Study of Labor (IZA).
    9. Michaela Kreyenfeld, 2000. "Employment careers and the timing of first births in East Germany," MPIDR Working Papers WP-2000-004, Max Planck Institute for Demographic Research, Rostock, Germany.
    10. Angelika Tölke, 2003. "Insecurities in employment and occupational careers and their impact on the transition to fatherhood in Western Germany," MPIDR Working Papers WP-2003-016, Max Planck Institute for Demographic Research, Rostock, Germany.
    11. Laura Bernardi & Andreas Klärner & Holger von der Lippe, 2006. "Perceptions of job instability and the prospects of parenthood. A comparison between Eastern and Western Germany," MPIDR Working Papers WP-2006-017, Max Planck Institute for Demographic Research, Rostock, Germany.
    12. Debra Friedman & Michael Hechter & Satoshi Kanazawa, 1994. "A theory of the value of children," Demography, Springer;Population Association of America (PAA), vol. 31(3), pages 375-401, August.
    13. Robert S. Chase, 2003. "Household fertility responses following communism: Transition in the Czech Republic and Slovakia," Journal of Population Economics, Springer;European Society for Population Economics, vol. 16(3), pages 579-595, August.
    14. Michael Lechner, 2005. "The Empirical Analysis of East German Fertility after," Labor and Demography 0505005, EconWPA.
    15. William A. Darity & Patrick L. Mason, 1998. "Evidence on Discrimination in Employment: Codes of Color, Codes of Gender," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 63-90, Spring.
    16. Bhaumik, Sumon Kumar & Nugent, Jeffrey B, 1999. "Analysis of Food Demand in Peru: Implications for Food-Feed Competition," Review of Development Economics, Wiley Blackwell, vol. 3(3), pages 242-257, October.
    17. T.D. Stanley & Stephen B. Jarrell, 1998. "Gender Wage Discrimination Bias? A Meta-Regression Analysis," Journal of Human Resources, University of Wisconsin Press, vol. 33(4), pages 947-973.
    18. Stacy Dickert-Conlin & Amitabh Chandra, 1999. "Taxes and the Timing of Birth," Journal of Political Economy, University of Chicago Press, vol. 107(1), pages 161-177, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Brainerd, Elizabeth, 2010. "The Demographic Transformation of Post-Socialist Countries," WIDER Working Paper Series 015, World Institute for Development Economic Research (UNU-WIDER).
    2. Gete, Pedro & Porchia, Paolo, 2010. "Fertility and Consumption when Having a Child is a Risky Investment," MPRA Paper 27885, University Library of Munich, Germany.
    3. Ariane Pailhé & Anne Solaz, 2012. "The influence of employment uncertainty on childbearing in France: A tempo or quantum effect?," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 26(1), pages 1-40, January.

    More about this item

    JEL classification:

    • 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
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

    Statistics

    Access and download statistics

    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:edb:cedidp:06-06. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sarmistha Pal) or (Christopher F. Baum). General contact details of provider: http://edirc.repec.org/data/cedibuk.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.