Optimal fertility along the life cycle

Pierre Pestieau and Gregory Ponthiere

Economic Theory, 2014, vol. 55, issue 1, 185-224

Abstract: We explore the optimal fertility timing in a four-period OLG economy with physical capital, whose specificity is to include not one, but two reproduction periods. It is shown that, for a given total fertility rate, the economy exhibits quite different dynamics, depending on the timing of births. If all births take place in the late reproduction period, there exists no stable stationary equilibrium and the economy exhibits cyclical dynamics due to labor growth fluctuations. We characterize the long-run social optimum and show that optimal consumptions and capital depend on the optimal cohort growth factor, so that there is no one-to-one substitutability between early and late fertility. We also extend Samuelson’s Serendipity Theorem to our economy and study the robustness of our results to: (1) endogenizing fertility timing, (2) assuming rational anticipations about factor prices, (3) adding a third reproduction period. Copyright Springer-Verlag Berlin Heidelberg 2014

Keywords: Childbearing ages; Early and late motherhoods; Fertility; Overlapping generations; Social optimum; E13; E21; J13 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (33)

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Related works:
Working Paper: Optimal fertility along the life cycle (2014)
Working Paper: Optimal fertility along the life cycle (2014)
Working Paper: Optimal fertility along the life cycle (2014)
Working Paper: Optimal fertility along the lifecycle (2011)
Working Paper: Optimal Fertility along the Lifecycle (2011)
Working Paper: Optimal Fertility along the Lifecycle (2011)
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DOI: 10.1007/s00199-013-0747-1

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