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Fertility decisions of families in an intergenerational exchange model
Author(s) -
Yakita Akira
Publication year - 2020
Publication title -
review of development economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.531
H-Index - 50
eISSN - 1467-9361
pISSN - 1363-6669
DOI - 10.1111/rode.12704
Subject(s) - fertility , economics , wage , wage rate , total fertility rate , labour economics , demographic economics , child care , family planning , demography , medicine , population , sociology , research methodology , pediatrics
We analyze fertility decisions of families using an intergenerational exchange model that might be applicable to less‐developed economies. When the probability of becoming dependent increases for parents who have children for elderly support, the parents increase their number of children. Increases in the children’s wage rates decrease the fertility rate when the elasticity of marginal utility of family care is low. In such cases, children’s care might be replaced eventually by market care insurance along with economic development. Decreasing fertility might not derive from a quantity–quality trade‐off of children for parents but might instead derive from a decreased need by children for bequests when wages are increasing.