Private and Social Incentives for Fertility: Israeli Puzzles

45 Pages Posted: 7 Jun 2002 Last revised: 27 Oct 2010

See all articles by Charles F. Manski

Charles F. Manski

Northwestern University - Department of Economics; National Bureau of Economic Research (NBER)

Joram Mayshar

Hebrew University of Jerusalem - Department of Economics

Date Written: June 2002

Abstract

Whereas most of the world has experienced decreasing fertility during the past half century, Israel has experienced a puzzling mix of trends. Completed fertility has decreased sharply in some ethnic-religious groups (Mizrahi Jews and non-Bedouin Arabs) and increased moderately in other groups (non-ultra-orthodox Ashkenazi and Israeli-born Jews). In a phenomenon that can only be described as a reverse fertility transition, fertility has increased substantially (from about 3 to 6 children per women) among ultra-orthodox Ashkenazi and Israeli-born Jews. This paper explores how private and social incentives for fertility may have combined to produce the complex pattern of fertility in Israel. Theoretical analysis of the social dynamics of fertility shows that this pattern could have been generated by the joint effects of (a) private preferences for childbearing, (b) preferences for conformity to group fertility norms, and (c) the major child-allowance program introduced by the Israeli government in the 1970s. Econometric analysis of fertility decisions shows that fundamental identification problems make it difficult to infer the actual Israeli fertility process from data on completed fertility. Hence we are able to conjecture meaningfully on what may have happened, but we cannot definitively resolve the Israeli fertility puzzles.

Suggested Citation

Manski, Charles F. and Mayshar, Joram, Private and Social Incentives for Fertility: Israeli Puzzles (June 2002). NBER Working Paper No. w8984, Available at SSRN: https://ssrn.com/abstract=315334

Charles F. Manski (Contact Author)

Northwestern University - Department of Economics ( email )

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National Bureau of Economic Research (NBER)

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Joram Mayshar

Hebrew University of Jerusalem - Department of Economics ( email )

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Israel
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