Mon, April 6
Jinkook Lee, Wellbeing of the Elderly in East Asia
Hotz, Joseph, Jacob Alex Klerman, and Robert Willis. "The Economics of Fertility in Developed Countries: A Survey." PSC Research Report No. 97-379. January 1997.
In this chapter we survey the intellectual development and empirical implications of the literature on the economics of fertility behavior in developed economies. We have two primary objectives. First, we seek to review the important theoretical developments, or model faetures, spawned by attempts to explain household fertility within a neoclassical framework. In the process we characterize how the development ot the theory of the allocation of time, the concepts of household production theory, and human capital investment theory, among others, helped improve our understanding of the fertility decisions of households in developed societies. Second, we attempt to characterize the implications that these models provide for empirical assessments of fertility behavior. As is true in many other subfields of economics, strategies for identifying the effects of relationships implied by neoclassical economic models of consumer choice, even those as straightforward as the effect of a price change on a household's demand for a good, are often controversial. Assessing the validity of implications of economic models of fertility is no exception to this pattern. We characterize the identification problems as they arise in this context, and we highlight several studies which, in our view, follow exemplary strategies for obtaining estimates of causal relationships, especially with respect to their credibility. The paper begins with a survey of trends in fertility in the U.S., proceeds to discussions of static and dynamic models of fertility behavior and is followed by an analysis of econometric approaches and empirical findings about the determinants of fertility. Some directions for future research are mentioned in the conclusion.