Full Citation

Title: Easterlin Revisted: Relative Income and the Baby Boom

Citation Type: Miscellaneous

Publication Year: 2014

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Abstract: This paper reexamines the first viable and a still leading explanation for mid-twentieth century baby booms: Richard Easterlins relative income hypothesis. He suggested that when incomes are higher than material aspirations (formed in childhood), birth rates would rise. This paper uses microeconomic data to formulate a measure of an individuals relative income. The use of microeconomic data allows the researcher to control for both state fixed effects and cohort fixed effects, both have been absent in previous examinations of Easterlins hypothesis. The results of the empirical analysis are consistent with Easterlins assertion that relative income influenced fertility decisions, although the effect operates only through childhood income. When the estimated effects are contextualized, they explain 12 percent of the U.S. baby boom.

Url: http://www.econ.upf.edu/docs/papers/downloads/1453.pdf

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Authors: Hill, Matthew J.

Publisher: Pompeu Fabra University

Data Collections: IPUMS USA

Topics: Fertility and Mortality, Labor Force and Occupational Structure, Other, Poverty and Welfare

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