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Variety expansion and fertility rates

  • Akiko Maruyama


    (Population Research Institute, Nihon University)

  • Kazuhiro Yamamoto


    (Graduate School of Economics, Osaka University)

To investigate how fertility rates interrelate with the modern economy, we construct a simple model in which variety expansion of consumption goods reduces fertility rates. In our model, variety expansion reduces the relative price of a composite of differentiated goods compared to child- rearing costs. Thus, parents raise the expenditure share for differentiated goods and lower the number of children. We show that this model can be applied to a growth model in which economic growth progresses with variety expansion of consumption goods and fertility rates decrease with economic growth. In addition, we show that international trade, which raises consumption variety, lowers fertility rates. Thus, we show a new mechanism for fertility decline, and this mechanism can be applied to growth and international trade models.

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Paper provided by Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP) in its series Discussion Papers in Economics and Business with number 07-29-Rev.2.

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Length: 22 pages
Date of creation: Jul 2007
Date of revision: Jun 2008
Handle: RePEc:osk:wpaper:0729r2
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  1. Kalemli-Ozcan, Sebnem, 2003. "A stochastic model of mortality, fertility, and human capital investment," Journal of Development Economics, Elsevier, vol. 70(1), pages 103-118, February.
  2. Kalemli-Ozcan, Sebnem & Ryder, Harl E. & Weil, David N., 2000. "Mortality decline, human capital investment, and economic growth," Journal of Development Economics, Elsevier, vol. 62(1), pages 1-23, June.
  3. Oded Galor, 2006. "The Demographic Transition," Working Papers 2006-24, Brown University, Department of Economics.
  4. Paul Romer, 1989. "Endogenous Technological Change," NBER Working Papers 3210, National Bureau of Economic Research, Inc.
  5. Oded Galor & David N. Weil, 1998. "Population, Technology, and Growth: From the Malthusian Regime to the Demographic Transition," Working Papers 98-1, Brown University, Department of Economics, revised 19 Aug 1998.
  6. Eckstein, Zvi & Wolpin, Kenneth I., 1985. "Endogenous fertility and optimal population size," Journal of Public Economics, Elsevier, vol. 27(1), pages 93-106, June.
  7. Galor, Oded & Weil, David N, 1996. "The Gender Gap, Fertility, and Growth," American Economic Review, American Economic Association, vol. 86(3), pages 374-87, June.
  8. Galor, Oded, 2004. "From Stagnation to Growth: Unified Growth Theory," CEPR Discussion Papers 4581, C.E.P.R. Discussion Papers.
  9. Oded_Galor & Andrew Mountford, 2006. "Trade and the Great Divergence: The Family Connection," Working Papers 2006-01, Brown University, Department of Economics.
  10. Kalemli-Ozcan, Sebnem, 2002. " Does the Mortality Decline Promote Economic Growth?," Journal of Economic Growth, Springer, vol. 7(4), pages 411-39, December.
  11. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
  12. David N. Weil & Oded Galor, 2000. "Population, Technology, and Growth: From Malthusian Stagnation to the Demographic Transition and Beyond," American Economic Review, American Economic Association, vol. 90(4), pages 806-828, September.
  13. repec:rus:hseeco:122439 is not listed on IDEAS
  14. Gary S. Becker & Kevin M. Murphy & Robert Tamura, 1994. "Human Capital, Fertility, and Economic Growth," NBER Chapters, in: Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education (3rd Edition), pages 323-350 National Bureau of Economic Research, Inc.
  15. Tamura, Robert, 2002. "Human capital and the switch from agriculture to industry," Journal of Economic Dynamics and Control, Elsevier, vol. 27(2), pages 207-242, December.
  16. Sato, Yasuhiro & Yamamoto, Kazuhiro, 2005. "Population concentration, urbanization, and demographic transition," Journal of Urban Economics, Elsevier, vol. 58(1), pages 45-61, July.
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