Spread-ing uncertainty, shrinking birth rates

Chiara L. Comolli () and Daniele Vignoli ()
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Chiara L. Comolli: Institute of Social Sciences and Life Course and Social Inequality Research Center University of Lausanne

No 2019_08, Econometrics Working Papers Archive from Universita' degli Studi di Firenze, Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti"

Abstract: Most studies document the pro-cyclicality of fertility to business cycles or labor market indicators. However, part of the recent fertility drop witnessed in Europe after the Great Recession is not explained by traditional measures. The present study advances that birth postponement might have accelerated in response to rising uncertainty, which fuelled negative expectations and declining confidence about the future. To provide empirical support for the causal effect of perceived uncertainty on births rate, we focus on the case of the sovereign debt crisis of 2011-2012 in Italy. Perceived uncertainty is measured using Google trends for the term "spread" – the thermometer of the crisis both in media and everyday conversations – to capture the degree of concern to the general public about the stability of Italian public finances. A regression discontinuity in time identifies the effect of perceived uncertainty on birth rates in Italy as a drop between 2.5% and 5%.

Keywords: Uncertainty; Fertility; Spread; Europe (search for similar items in EconPapers)
JEL-codes: J10 J13 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2019-09
New Economics Papers: this item is included in nep-dem
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Persistent link: https://EconPapers.repec.org/RePEc:fir:econom:wp2019_08

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