Fertility and Housing

21 Pages Posted: 19 Aug 2015

See all articles by Creina Day

Creina Day

Australian National University

Date Written: August 2015

Abstract

Young households in Hong Kong face particularly steep increases in house prices and low fertility despite low gender wage gaps. The model of fertility and housing in this paper explains why fertility decline need not reverse as female wages rise relative to male wages where housing land is scarce. For given house prices, demand for children may rise with female relative wages if housing comprises a sufficiently large share of childrearing. If the user cost of housing falls with rising house prices then fertility also rises. For endogenous house prices, however, growth in wages and a burgeoning working age population raises the market price of housing. In turn, fertility no longer rises with female relative wages. The analysis provides a novel mechanism whereby high population support ratios depress fertility and the results fit recent evidence that house prices affect fertility.

Keywords: fertility, housing price, gender wages, working age population

JEL Classification: J10, J13, J16

Suggested Citation

Day, Creina, Fertility and Housing (August 2015). CAMA Working Paper 34/2015. Available at SSRN: https://ssrn.com/abstract=2646301 or http://dx.doi.org/10.2139/ssrn.2646301

Creina Day (Contact Author)

Australian National University ( email )

7 Liversidge Street
Lennox Crossing
Canberra, ACT 0200
Australia

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