New fertility patterns: The role of human versus physical capital

Nicolas Abad, Johanna Etner, Natacha Raffin and Thomas Seegmuller

Journal of Economic Theory, 2025, vol. 228, issue C

Abstract: We use an overlapping generations model with physical and human capital, and two reproductive periods to explore how fertility decisions may differ in response to economic incentives in early and late adulthood. In particular, we analyze the interplay between fertility choices—related to career opportunities—and wages, and investigate the role played by work experience and investment in both types of capital. We show that young adults postpone parenthood above a certain wage threshold and that late fertility increases with human capital. The long run trend is either to converge to a low productivity equilibrium, involving high early fertility, investment in physical capital and relatively low income, or to a high productivity equilibrium, where households postpone parenthood to invest in their human capital and work experience, with higher late fertility and higher levels of income. A convergence to the latest state would explain the postponement of parenthood and the mitigation or slight reversal of fertility decrease in some European countries in recent decades.

Keywords: Fertility; Postponement; Work experience; Overlapping generations (search for similar items in EconPapers)
JEL-codes: E21 J11 J13 (search for similar items in EconPapers)
Date: 2025
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Working Paper: New fertility patterns: The role of human versus physical capital (2024)
Working Paper: New fertility patterns: The role of human versus physical capital (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:228:y:2025:i:c:s0022053125000833

DOI: 10.1016/j.jet.2025.106037

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