Working Paper: CEPR ID: DP3059
Authors: Omer Moav
Abstract: This Paper develops a theory of fertility and child educational choice that offers an explanation for the persistence of poverty within and across countries. The joint determination of the quality (education) and quantity of children in the household is studied under the key assumption that individuals' productivity as teachers increases with their own human capital. As a result, the poor choose high fertility rates with low education investment and therefore, their offspring are poor as well. Furthermore, the high fertility rates in poor economies dilute physical capital accumulation and amplify the effect of child quality choice on economic growth. The model generates multiple steady states even though the technologies employed in the production of human capital and output are convex and preferences are convex and homothetic.
Keywords: fertility; growth; human capital
JEL Codes: J13; O11; O15; O40
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| high fertility rates (J13) | low educational investment per child (I21) |
| parents' human capital (J24) | high fertility rates (J13) |
| parents' human capital (J24) | low educational investment per child (I21) |
| low educational investment per child (I21) | poverty persistence (I32) |
| high fertility rates (J13) | poverty persistence (I32) |
| parents' human capital (J24) | educational outcomes of offspring (I26) |
| educational outcomes of offspring (I26) | economic outcomes (F61) |