Understanding how having children influences the parents' subjective well-being ("happiness") has great potential to explain fertility behavior. Most prior research on this topic is limited in that it uses cross-sectional data or has not considered modifying factors. We study parental happiness trajectories before and after the birth of a child using large British and German longitudinal data sets. We account for unobserved parental characteristics using fixed effects models and study how sociodemographic factors modify the parental happiness trajectories. Overall, we find that happiness increases in the years around the birth of the first child, then decreases to before-child levels. Sociodemographic factors strongly modify this pattern. Those who have children at older ages and those with higher socioeconomic resources have more positive and lasting happiness response to a first birth than younger or less educated parents. We also find that although the first two children increase happiness, the third does not. The results are similar in Britain and Germany and suggest that up to two, children increase happiness, and mostly among those who postpone childbearing. This pattern, which is consistent with the behavior emerging during the second demographic transition, provides new insights into the factors behind low and late fertility.
Acknowledgements:We are grateful for comments from