Journal of Population Economics

, Volume 24, Issue 3, pp 1053–1070 | Cite as

Hyperbolic discounting and fertility

  • Matthias Wrede
Original Paper


This paper analyzes the impact of hyperbolic discounting on the timing and on the number of births. Using a simple three-period model, it shows that, without the opportunity to shift the burden of rearing children into the future, hyperbolic discounters will give birth to fewer children. If child-care costs can be shifted completely to later periods, the impact of hyperbolic discounting on births depends on the underlying motive for motherhood, namely, whether children are regarded as consumption or investment goods. A large-sample empirical analysis, which uses an inconsistent savings pattern as an indicator of time inconsistency, confirms the theoretical results.


Fertility Hyperbolic discounting Time inconsistency 

JEL Classification

J13 D19 D91 



Previous versions of this paper were presented at the 2007 Annual Congress of the Verein für Socialpolitik, at the 2009 Annual Congress of the European Economic Association, and at a research seminar at the University of Augsburg. Many thanks to the participants. Furthermore, the paper has considerably benefited from referees’ advice. The usual disclaimer applies.


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Copyright information

© Springer-Verlag 2009

Authors and Affiliations

  1. 1.Faculty of Business Administration and EconomicsUniversity of MarburgMarburgGermany

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