Cheap Children and the Persistence of Poverty
Maurice Falk Institute Discussion Paper No. 01.02
35 Pages Posted: 24 Aug 2001
Date Written: February 12, 2004
This paper develops a theory of fertility that offers an explanation for the persistence of poverty within and across countries. If educated individuals have a comparative advantage in raising educated children then parental fertility choice is shown to give rise to a poverty trap, in which the poor choose high fertility rates with low investment in child quality. Moreover, the impact of child quality choice on economic performance is amplified by the diluting effect of higher fertility on physical capital accumulation. The theory proposes insights regarding the effects of inequality, globalization, and life expectancy on economic growth and demographic transitions.
Keywords: Fertility, Human Capital, Growth
JEL Classification: J13, O11, O15, O40
Suggested Citation: Suggested Citation