Women’s Fertility and Labor Market Responses to a Health Innovation

Abstract

We investigate women’s fertility, labor and marriage market responses to a health innovation that led to reductions in mortality from treatable causes, and especially large declines in child mortality. We find delayed childbearing, with lower intensive and extensive margin fertility, a decline in the chances of ever having married, increased labor force participation and an improvement in occupational status. Our results provide the first evidence that improvements in child survival allow women to start fertility later and invest more in the labor market. We present a new theory of fertility that incorporates dynamic choices and reconciles our findings with existing models of behavior.

The impact of flexibility at work on fertility

“…where z measures the price of child quantity. In the classical economic treatment of fertility (e.g., Becker andLewis 1973, Bhalotra, Venkataramani, andWalther 2023) z is often viewed as being exogenously determined by the market price of child quantity. By contrast, to further explore the consequences of greedy work and greedy children, we allow z to be endogenously determined by the woman's time use.…”

“…Consequently, our model predicts a larger fertility increase for the low flexibility woman. We rely on this approach, where baseline levels of a variable are used to predict absolute changes and therefore the intensity of a treatment (as in Acemoglu and Johnson (2007), Bhalotra, Venkataramani, and Walther (2023) and Ager, Hansen, and Jensen (2017)), to provide evidence that flexibility changes were the key driver of fertility increases. Our theoretical model also predicts a greater fertility response among women working longer hours.…”