The Baby Boom and World War II: A Macroeconomic Analysis
Northwestern University - Department of Economics; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER); Institute for the Study of Labor (IZA)
Hebrew University of Jerusalem - Department of Economics; Centre for Economic Policy Research (CEPR)
The Open University of Israel - Department of Management and Economics
CEPR Discussion Paper No. DP6628
We argue that one major cause of the U.S. postwar baby boom was the increased demand for female labour during World War II. We develop a quantitative dynamic general equilibrium model with endogenous fertility and female labour-force participation decisions. We use the model to assess the long-term implications of a one-time demand shock for female labour, such as the one experienced by American women during wartime mobilization. For the war generation, the shock leads to a persistent increase in female labour supply due to the accumulation of work experience. In contrast, younger women who turn adult after the war face increased labour-market competition, which impels them to exit the labour market and start having children earlier. In our calibrated model, this general-equilibrium effect generates a substantial baby boom followed by a baby bust, as well as patterns for age-specific labour-force participation and fertility rates that are consistent with U.S data.
Number of Pages in PDF File: 49
Keywords: Baby boom, female labour-force participation, fertility, World War II
JEL Classification: D58, E24, J13, J20working papers series
Date posted: June 5, 2008
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