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Measuring cost of children using equivalence scale on Japanese panel data

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  • Masako Oyama

Abstract

In this study, the cost of child rearing is estimated in order to examine the hypothesis that the recent fertility decline in Japan has been caused by increases in the cost of child rearing. Although there are various ways to estimate the cost of children, the research uses an equivalence scale. The results of the traditional Rothbarth estimation showed that the cost of child raising in Japan is not very high. However, the results of the equivalence scale estimation using 'satisfaction for the income' as the utility measure showed that the cost of child raising is much higher than calculated in the Rothbarth model. The latter subjective scale approach is now said to have more advantages. Thus, the cost of child raising in Japan is much higher than was believed to be the case, and this could be one of the reasons for the decline in the fertility rate in Japan.

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  • Masako Oyama, 2006. "Measuring cost of children using equivalence scale on Japanese panel data," Applied Economics Letters, Taylor & Francis Journals, vol. 13(7), pages 409-415.
    • Handle: RePEc:taf:apeclt:v:13:y:2006:i:7:p:409-415
    DOI: 10.1080/13504850500193042
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    1. Junji Kageyama & Tsukasa Matsuura, 2018. "The Financial Burden of Having Children and Fertility Differentials Across Development and Life Stages: Evidence from Satisfaction Data," Journal of Happiness Studies, Springer, vol. 19(1), pages 1-26, January.
    2. Hori, Masahiro, 2011. "The expenditure on children in Japan," CIS Discussion paper series 527, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
    3. Raziye Selim & Gizem Kaya, 2018. "The Changes of Cost of Children for Turkey by Using Income-Dependent Equivalence Scales," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 139(2), pages 803-824, September.

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