Fertility decisions of families in an intergenerational exchange model

摘要

We analyze fertility decisions of families using an intergenerational exchange model that might be applicable to less-developed economies. When the probability of becoming dependent increases for parents who have children for elderly support, the parents increase their number of children. Increases in the children's wage rates decrease the fertility rate when the elasticity of marginal utility of family care is low. In such cases, children's care might be replaced eventually by market care insurance along with economic development. Decreasing fertility might not derive from a quantity-quality trade-off of children for parents but might instead derive from a decreased need by children for bequests when wages are increasing.