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Optimal Lifecycle Fertility in a Barro Becker Economy

Author

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  • Pierre Pestieau

    (CREPP - Center of Research in Public Economics and Population Economics - Université de Liège, PSE - Paris-Jourdan Sciences Economiques - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics, CORE - Center of Operation Research and Econometrics [Louvain] - UCL - Université Catholique de Louvain, CEPR - Center for Economic Policy Research - CEPR)

  • Grégory Ponthière

    (PSE - Paris-Jourdan Sciences Economiques - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics)

Abstract

Parenthood postponement is a key demographic trend of the last three decades. In order to rationalize that stylized fact, we extend the canonical model by Barro and Becker (1989) to include two - instead of one reproduction periods. We examine how the cost structure of early and late children in terms of time and goods a¤ects the optimal fertility timing. Then, focusing a stationary equilibrium with stationary population, we provide two alternative explanations for the observed postponement of births: (1) a fall of the direct cost of late children (thanks to medical advances); (2) a rise in hourly productivity, which increases the (relative) opportunity costs of early children in comparison to late children.

Suggested Citation

  • Pierre Pestieau & Grégory Ponthière, 2012. "Optimal Lifecycle Fertility in a Barro Becker Economy," PSE Working Papers halshs-00676500, HAL.
  • Handle: RePEc:hal:psewpa:halshs-00676500
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00676500
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    References listed on IDEAS

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    1. Ermisch, John & Ogawa, Naohiro, 1994. "Age at Motherhood in Japan," Journal of Population Economics, Springer;European Society for Population Economics, vol. 7(4), pages 393-420, November.
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    7. Schultz, T Paul, 1985. "Changing World Prices, Women's Wages, and the Fertility Transition: Sweden, 1860-1910," Journal of Political Economy, University of Chicago Press, vol. 93(6), pages 1126-1154, December.
    8. Pierre Pestieau & Gregory Ponthiere, 2014. "Optimal fertility along the life cycle," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 55(1), pages 185-224, January.
    9. d'Albis, Hippolyte & Augeraud-Véron, Emmanuelle & Schubert, Katheline, 2010. "Demographic-economic equilibria when the age at motherhood is endogenous," Journal of Mathematical Economics, Elsevier, vol. 46(6), pages 1211-1221, November.
    10. Heckman, James J & Walker, James R, 1990. "The Relationship between Wages and Income and the Timing and Spacing of Births: Evidence from Swedish Longitudinal Data," Econometrica, Econometric Society, vol. 58(6), pages 1411-1441, November.
    11. Samuelson, Paul A, 1975. "The Optimum Growth Rate for Population," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 16(3), pages 531-538, October.
    12. Pierre Pestieau & Grégory Ponthière, 2011. "Optimal Fertility along the Lifecycle," Working Papers hal-00612609, HAL.
    13. Matthias Doepke, 2005. "Child mortality and fertility decline: Does the Barro-Becker model fit the facts?," Journal of Population Economics, Springer;European Society for Population Economics, vol. 18(2), pages 337-366, June.
    14. Siv Gustafsson, 2001. "Optimal age at motherhood. Theoretical and empirical considerations on postponement of maternity in Europe," Journal of Population Economics, Springer;European Society for Population Economics, vol. 14(2), pages 225-247.
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    Cited by:

    1. Pierre Pestieau & Gregory Ponthiere, 2014. "Optimal fertility along the life cycle," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 55(1), pages 185-224, January.
    2. Andras Simonovits, 2015. "Optimal Child-Related Transfers and Personal Income Tax with Endogenous Fertility," IEHAS Discussion Papers 1524, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
    3. Pierre Pestieau & Grégory Ponthière, 2015. "Long-term care and births timing," Working Papers halshs-01131236, HAL.
    4. Gregory Ponthiere, 2016. "The contribution of improved joint survival conditions to living standards: an equivalent consumption approach," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 46(2), pages 407-449, February.
    5. Pestieau, Pierre & Ponthiere, Gregory, 2016. "Long-term care and births timing," Journal of Health Economics, Elsevier, vol. 50(C), pages 340-357.
    6. Grégory Ponthière, 2015. "The contribution of improved joint survival conditions to living standards: An equivalent consumption approach," Working Papers halshs-01194427, HAL.
    7. Hippolyte D'Albis & Angela Greulich & Grégory Ponthière, 2017. "Development, fertility and childbearing age: A unified growth theory," PSE Working Papers halshs-01452846, HAL.
    8. Andras Simonovits, 2015. "Socially Optimal Child-Related Transfers and Personal Income Tax with Endogenous Fertility," IEHAS Discussion Papers 1537, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.

    More about this item

    Keywords

    Fertility; Birth Timing; Population; Dynastic Altruism; OLG Model;

    JEL classification:

    • D10 - Microeconomics - - Household Behavior - - - General
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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