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Date
Jun
06
2006

A Lower Price of Child Survival Lowers Fertility: Testing Quality Quantity Tradeoff In Africa

Presenter:

David Bishai

Authors:

Feng Zhao, David Bishai

Chair: David Bishai; Discussant: TBA Tue June 6, 2006 10:45-12:15 Room 325

The economist’s version of demographic transition theory stresses the role of price above the role of income in lowering first mortality and then fertility. Prior to the 19th century, households could not purchase significant improvements in child survival regardless of income. Technological developments that lowered the price of child survival are thought to have induced rapid substitution away from child quantity towards child quantity. According to this view: better child survival prices are the leading impetus for fertility reduction. The difficulty of measuring the price of child survival has impeded empirical tests of this central theory in economic demography.

We studied 15 Demographic and Health Surveys (DHS) from 9 sub-Saharan African countries. We theorized that there would be geographical variation in the ability of households to trade money for child survival. Using household level data stratified across 97 regions within the database we identified the regional price of child survival as the coefficient on the household asset score in a logistic regression on whether a child died before age 5. This produced a set of 97 regional coefficients (Pquality) which we interpreted as signifying geographical differences in the ability of households to trade wealth for child survival. In the second stage, we regressed the regional fertility rate against Pquality and aggregate indicators of economic development. In accordance with theory we found a positive elasticity of 1.71 (95% CI: 0.901 to 2.526) for the price of child quality on fertility and an elasticity of -0.193 (95% CI: -0.244 to -0.142) for the effects of regional wealth on regional fertility. A positive cross price elasticity between child quality and child quantity suggests that these are substitutes.

Our evidence is consistent with Becker’s theory of quality quantity tradeoff and emphasizes the central role of making child survival more affordable before expecting to see fertility declines in a population. When child quality (i.e. survival) was more expensive, households appeared to substitute towards child quantity. These results predict that if an uncontrolled epidemic (such as AIDS) makes child survival less affordable that fertility will rise even if educational attainments and household incomes remain constant or rise

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