Fertility and Education Premiums*

Carol Scotese ()

No 201, Working Papers from VCU School of Business, Department of Economics

Abstract: This paper examines households’ fertility variations in response to expected permanent shifts in the returns to education. Wage premiums are used to measure the returns to education because their longrun movements are driven largely by factors exogenous to the fertility process. Drawing households from the NLS mature and younger women cohorts yields a cross-section of households (women) with time-series variation in their childbearing years and who differ in their expectations of future wage premiums. The results indicate that for high education parents, an increase in the expected return to college is associated with lower fertility while an increase in the expected return to high school is associated with higher fertility. On the other hand, low education parents tend to be unresponsive to swings in the expected returns to either a college or high school education. These results can be consistently interpreted within a standard quality/quantity model of endogenous fertility.

Pages: 30 pages
Date: 2002-06
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Published in Journal of Population Economics, 2003, pages 555-578

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