Microeconomic Theories of Fertility: A Critique

Abstract

An attempt is made to assess the current state of knowledge in the area of microeconomic analysis of fertility behavior. With the focus on theories relevant to the U.S. and other industrial countries the advantages and disadvantages of the consumer theory approach to fertility are examined. A number of specific issues are raised: 1) the usefulness of the concept of child quality 2) the impact of income on family size 3) the time frame of the fertility decision 4) husband and wife interaction in the decision process and 5) the analysis of fertility regulating behavior. Additionally the paper concludes with a discussion of empirical issues raised by the new microeconomic studies of fertility. The ultimate goal of the microeconomic theories of fertility is to explain the variance in completed family size at the level of the individual couple. Traditionally this has been accomplished by analyzing the impact of differential social correlates; however recent data have shown that the explanatory power of these variables has been decreased considerably. By moving attention from social correlates of group behavior toward the factors that affect individual decisions directly the microeconomic theories offer the possibility of new ways to analyze old data along with suggesting the collection and analysis of new variables which might improve the ability to account for the variance in completed family size. Unfortunately the major insufficiency of the economic analysis of fertility to date has been the lack of correspondence between the theoretical formulations and the empirical tests undertaken. (AUTHORS MODIFIED)