Research program : Fertility & Incentives

Scientists are divided between those who believe that fertility is not subject to rational choice or control and those who believe it is. Most economists are on the rational-choice side, while demographers tend to ascribe to the no-choice view (see Lee, Journal of Demographic Economics, 2015). This divide overlaps with another partition between socioeconomic theories of the fertility decline on the one hand and diffusionist/cultural views on the other (following the denominations of Lee, 2015). The rational choice approach of Nobel Prize winner Gary Becker clearly belongs to the first strand, while, for example, the Princeton study which examined the timing of fertility change and the county level in Europe concludes in favour of the diffusionist/cultural view.

Understanding which mechanism matters most is important for policy design. If, according to the diffusionist/cultural view, fertility is a question of culture and norms instead of incentives, policy focusing on incentives (family allowances, tax break for families etc.) have little impact.

These slides give a general introduction to the subject: Does fertility respond to economic incentives? and does it matter?

I work more particularly on the following topics: Fertility, incentives and norm, Religion, Fertility and Growth, Fertility and conflict, Demographic convergence, Differential fertility, Population policy.

Fertility, incentives and norms

Even in the case of nineteenth century France, which is considered the pioneer in low fertility norms, socioeconomic conditions affect fertility. Indeed, a model featuring optimal parental behavior in terms of fertility, education, and child rearing has some power in explaining the variation of fertility and education across time and space. Hence, incentives matter.

Links:

The relevance of quantitative economic theory for historical demography. In Koen Matthijs; Saskia Hin, Jan Kok, Hideko Matsuo (eds), Demographic Change and Long-Run Development, Leuven: Acco, 2016.

teaser | article | slides

How Far Can Economic Incentives Explain the French Fertility and Education Transition?, European Economic Review, 108, 221-245 [with F. Perrin]

Religions, Fertility, and Growth in South East Asia

Many religions are supposedly pro-natalist, as witnessed for example by the injunction:

Gen 1,28

The "multiply" is clearly related to the quantity of children, but the "be fruitful" can be seen as covering aspects of quality. In Hebrew, the modern term "productivity" is related to the same root, which has to do with fruits from trees.

In the paper below, we show that religions may or may not damage long-run growth, depending on whether they only encourage members to have more children (pro-birth religion) or they encourage members to both have more children and to educate them better (pro-child religion).

Viewing South-East Asia as a microcosm gathering most world religions, we first pooled the censuses of the countries for which religious affiliation is available, together with data on completed fertility and education. Second, we identify the effects described above by interacting religion and education variables. Third, interpreting this fertility-education relationship with Becker's theory of fertility, we relate the speed at which fertility declines when parents' education rises to the willingness of the parents to substitute child quantity for child quality. Fourth, we highlight that these characteristics have consequences for growth.

Links:

Religions, Fertility, and Growth in South-East Asia, International Economic Review, 59, 907-946, 2018 [with C. Delavallade]

Fertility and Conflict

Fertility becomes a strategic choice when having a larger population helps to gain power. Minority groups might and it optimal to promote high fertility among their members (this is known as the "weapon of the womb" argument). In a first paper we develop the theory of a "population race" between groups, and relate this mechanism to the environmental in Easter Island. In a second paper, we consider the consequences of population races on education investment, showing that higher fertility for strategic motives might reduce educational investment in theory, unless human capital too is an input in the contest function.

Links:

Easter Island Collapse: a Tale of Population Race, Journal of Economic Growth, 13, 27-55, 2008 [with D. Dottori].

Strategic Fertility, Education Choices, and Conflicts in Deeply Divided Societies Journal of the European Economic Association [with E. Bezin and B. Chabé-Ferret]

Education Funding and the Sustainability of Diverse Societies, in The Political Function of Education in Deeply Divided Countries, Theodor Hanf ed., Nomos, 321-332, 2011.

teaser | article | citation

Demographic Convergence

We study whether fertility behavior reflects some spontaneous convergence forces leading population to a stable long-run level. In natural sciences, this property is called population homeostasis. In animal populations, the predator - prey models may display such a property, depending on their parameters. In human populations, predators are absent, but humans could act as such on the limited amount of resources. If convergence forces are at work, one should observe a correlation between fertility and population density. For high levels of density, fertility should be low for a population to stabilize.

We test the existence of such effect in 44~developing countries, matching georeferenced data from the demographic and health survey for half a million woman with population density grid. The following picture shows the different clusters (locations) considered.

clusters used in the analysis

When we correct for selection and endogeneity bias and control for the usual determinants of fertility such as education and income, a rise in density from 10 to 1000 inhabitants per square kilometer goes with a decrease in fertility by about 0.6 child. Duration analysis shows that age at marriage and age at first birth both increase with density.

Links:

Population Density, Fertility, and Demographic Convergence in Developing Countries, Journal of Development Economics, 127, 13-24, 2017 [with P. Gobbi]

Differential fertility

Matthias and I in Chicago

With Matthias Doepke, we emphasize that parents face a trade-off between having many children versus spending large resources on the health and education of each of them. This approach, first developed by Becker, is particularly successful to explain fertility differences as a function of the social class of the parents. Educated parents, for whom time is highly valuable on the labor market, will optimally choose to have few children but spend more resources on their education and health. This model predicts how the size and the composition of population would change in the future through their interaction with the economic and natural environment. Population dynamics, but also population composition, are essential for the development of poor countries and the future of the Earth.

De la Croix and Doepke (2003) show that differential fertility accounts for most of the empirical relationship between inequality and growth. Poor parents decide to have many children and invest little in education. A mean-preserving spread in the income distribution increases the fertility differential between the rich and the poor, which implies that more weight gets placed on families who provide little education. Consequently, an increase in inequality lowers average education and, therefore, growth.

Policy implications are drawn in a second and third paper: Public education can help to promote growth by reducing differential fertility (De la Croix and Doepke 2004). When private and public education coexist (De la Croix and Doepke 2009), high social class families choose more often private education compared to low social class families. In our 2009 study, we ask why different societies make different choices regarding the mix of private and public schooling. We show that in a given political environment, high income inequality leads to more private education, as rich people opt out of the public system. More private education, in turn, results in an improved quality of public education, because public spending can be concentrated on fewer students. Comparing across political systems, we find that concentration of political power can lead to multiple equilibria in the determination of public education spending. The main predictions of the theory are consistent with state-level and micro data from the United States as well as cross-country evidence from the PISA study.

Links:

To Segregate or to Integrate: Education Politics and Democracy, Review of Economic Studies, 76, 597-628, 2009 [with M. Doepke].

Public versus private education when differential fertility matters, Journal of Development Economics, 73, 607-629, 2004 [with M. Doepke]

teaser | abstract | article | citation | Doepke

Inequality and growth: why differential fertility matters, American Economic Review, 93, 1091-1113, 2003 [with M. Doepke]

Population Policy

We explore the implications of setting up a system of tradable procreation entitlements to control population in a context of differential fertility, both domestically and at the global level.

One of the first tradable rights proposal was made by Boulding in the context of population control in 1964. We generalize his framework with both tradable procreation allowances and tradable procreation exemptions, in order to tackle both over- and under-population problems.

As far as human capital is concerned, natalist policy worsens the average education level of the next generation, while population control enhances it.

The implications of procreation rights for income inequality and education are contrasted. Our exploratory analysis suggests that procreation entitlements offer a promising tool to control population without necessarily leading to problematic distributive impact, especially at the global level. Moreover, if procreation rights are granted to countries in proportion to existing fertility levels (grandfathering) instead of being allocated equally, population control can be made even more redistributive.

Links:

Population Policy through Tradable Procreation Entitlements, International Economic Review, 50, 507-542 [with A. Gosseries].

Procreation, Migration, and Tradable Quotas, in Population Aging, Intergenerational Transfers and the Macroeconomy, R. Clark, A.Mason and N. Ogawa eds, Cheltenham, UK:Edward Elgar Publishing, 227-249, 2007 [with A. Gosseries].

teaser | article | discussion | citation | Gosseries

In the following paper, we consider the effect of an environmental tax. As a tax on output would affect the wages, and hence, the opportunity cost of children, households would reallocate their time towards non market activities, such as leisure and reproduction. As reproduction today generates pollution tomorrow, the problem will be even worse in the future. Population will tend to increase and production per capita to decrease as generations pass. The conclusion of the endogenous fertility model would therefore be that capping emissions will gradually leads to larger and poorer successive generations.

Links:

The Natalist Bias of Pollution Control, Journal of Environmental Economics and Management, 63, 271-287 [with A. Gosseries]