PT  - JOURNAL ARTICLE
AU  - Lindo, Jason M.
TI  - Are Children Really Inferior Goods?
AID  - 10.3368/jhr.45.2.301
DP  - 2010 Mar 01
TA  - Journal of Human Resources
PG  - 301--327
VI  - 45
IP  - 2
4099  - http://jhr.uwpress.org/content/45/2/301.short
4100  - http://jhr.uwpress.org/content/45/2/301.full
SO  - J Hum Resour2010 Mar 01; 45
AB  - This paper explores the causal link between income and fertility by analyzing women’s fertility response to the large and permanent income shock generated by a husband’s job displacement. I find that the shock reduces total fertility, suggesting that the causal effect of income on fertility is positive. A model that incorporates the time cost of children and assortative matching of spouses can simultaneously explain this result and the negative cross-sectional relationship. I also find that a husband’s displacement accelerates childbearing, which is consistent with lifecycle models of fertility in which the incentive to delay is driven by expected earnings growth.