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ABSTRACTThis paper provides a simple theoretical framework to discuss the relationship between assisted reproductive technologies and the microeconomics of fertility choice. Individuals make choices of education and work along with decisions about whether and when to have children. Decisions regarding fertility are influenced by policy and labor market factors that affect the earnings opportunities of mothers and the costs of raising children. We show how observed differences in these economic factors across countries explain observed different fertility and childbearing age patterns. We then use the model to predict behavioral responses to biomedical improvements in assisted reproductive technologies, and hence the impact of these technologies on fertility.
NON-TECHNICAL SUMMARYIn virtually every industrialized country the total fertility rate has been declining for more than four decades, and ever since the 1980s it has been below the 2.1 children per woman needed for a population to replace itself. Countries with sub-replacement fertility fall into two distinct groups. In countries where birth rates are moderately below replacement level, the population size falls only slowly and, if considered necessary, can be supplemented with migration. In contrast, countries where the fertility rate has fallen below 1.5 births per woman and has stayed below this threshold are said to be locked into a ``low fertility trap''. The anticipated economic consequences for countries in the low fertility trap are manifold, from a shortage of skilled young workers to a population ageing-related slowdown in the growth of GDP to an increase in age-related public spending. Demographers have recognized that a small increase or stabilization of total fertility could help countries in or at the brink of the low fertility trap prevent these economic problems from taking effect. Traditionally, most debates on stabilizing fertility rates focused on policies such as flexible working, maternity and paternity leave, and increasing benefits for second and third children. However, policymakers have recently started to take note of the potential role in stabilizing fertility rates of assisted reproductive technologies.This paper pursues two related objectives. The first half of the paper develops a simple model that allows us to explain the different reproductive patterns observed across industrialized and emerging countries. In the second half of ...