Working Paper: NBER ID: w9231
Authors: Charles H Mullin; Ping Wang
Abstract: We develop a tractable framework with a fully specified dynamic process of demographic and labor decisions over an individual female's life span to determine the timing of childbearing. Fertility affects women's behavior through three channels: its tradeoff with leisure, its interactions with human capital investment, and its cost in terms of lost market productivity. Instead of numerically solving a discrete-time version of the model, we propose an alternative solution technique that provides analytic, closed-form solutions for the continuous-time dynamic optimization problem with (discrete) time-line variables. The analytic results indicate that (i) increased impatience has an ambiguous effect on childbearing timing; (ii) the age at first birth rises at an increasing rate with the productivity loss from children; and (iii) women of greater ability have births at later ages and are more sensitive to parameter changes. Calibration exercises suggest that focusing on the median female's response to changes in the preference, cost, and technology parameters fails to capture their important distributional effects.
Keywords: No keywords provided
JEL Codes: J13; J24; D90; D30
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Increased impatience (E41) | childbearing timing (J13) |
| Ability (G53) | childbearing timing (J13) |
| productivity loss from children (J13) | age at first birth (J13) |