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Marginal Incentives for Birth Spacing

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  • Naidoo, Jesse

    (University of Chicago)

Abstract

I construct a model of life-cycle fertility choice and human capital accumulation in which women have the option to have children instantaneously, but the growth rate of human capital is potentially affected by the presence of children. Unless the growth rate of human capital falls permanently at the event of a birth, it will not be optimal to wait a finite, but nonzero, length of time between births. The model is, I argue, minimally sufficient to account for birth spacing. It is also simple enough to allow me to obtain its comparative statics analytically. The effects of fertility subsidies can be subtle: subsidies to marginal births accelerate the time to next birth, but subsidies to higher-order births extend times to the next birth. This ambiguity arises because forward-looking agents anticipate slower human capital growth in the future, and respond by accumulating more in the present.

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  • Naidoo, Jesse, 2022. "Marginal Incentives for Birth Spacing," OSF Preprints q9t7u, Center for Open Science.
    • Handle: RePEc:osf:osfxxx:q9t7u
    DOI: 10.31219/osf.io/q9t7u
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    References listed on IDEAS

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    1. Daniel Parent & Ling Wang, 2007. "Tax incentives and fertility in Canada: quantum vs tempo effects," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 40(2), pages 371-400, May.
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