Skip to main content

Advertisement

SpringerLink
Log in

Fertility and endogenous gender bargaining power

  • Original Paper
  • Published:
Journal of Population Economics Aims and scope Submit manuscript

Abstract

We develop an intra-household bargaining model to examine the feedback effect of household fertility decisions on gender bargaining power. In our model, the household balance of power is endogenously determined reflecting social interactions, i.e., the fertility choices by the other couples in society. We show the presence of multiple equilibria in fertility outcome: one equilibrium characterized by patriarchal society with a high fertility rate, and another in which women are sufficiently empowered and the fertility rate is low. In other circumstances, this study also demonstrates a positive relationship between female wage rates and the fertility outcomes. Finally, we discuss its policy implications, comparing the effects of two family policies: the child allowance and the subsidies for market childcare.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1
Fig. 2
Fig. 3

Similar content being viewed by others

Notes

  1. For fertility bargaining with exogenous bargaining power, see, for example, Lehrer (1996) and Eswaran (2002).

  2. Their specification of bargaining power relates to the traditional analysis of family bargaining where the bargaining positions are determined by individuals’ outside option in the case of breakdown in their negotiations. For an excellent survey on family bargaining, see Lundberg and Pollak (1996).

  3. The author thanks an anonymous referee for his/her introduction of the literature.

  4. Cigno (2012) showed that marital institution affects the couple’s choice whether to behave noncooperatively or cooperatively by specializing in either childcare or market work. Rasul (2008) also investigated the limited commitment problem of household and demonstrated that the absence of binding contract leads to inefficient fertility outcomes. In his study, however, since the women’s position is not characterized by her earnings, the negative effect of children on women’s labor supply is not explicitly considered.

  5. In both theoretical and empirical studies, many authors have shown that most societies have traditionally incorporated fertility trends into their gender role norms and that these norms may damage women’s economic position (Folbre 1997; Fernandez et al. 2004; Munshi and Myaux 2006; Feyrer et al. 2008).

  6. Many other existing evidences confirmed the heterogeneity in parental preferences of fertility outcomes (Mason and Taj 1987; Ngom 1997; Voas 2003). The family bargaining on fertility under these conflicting parental preferences is also observed in both developed and developing countries. Rasul (2008) found fertility bargaining using Malay and Malaysian Chinese micro-data while Hener (2010) confirmed that of German households.

  7. Breakdown of negotiations due to heterogeneous preferences are beyond our scope. As an explanation of this breakdown, Manser and Brown (1980) and McElroy and Horney (1981) translated the threat-point in Nash bargaining as divorce. For the intra-family bargaining analysis with the threat-point of noncooperative outcome, see Lundberg and Pollak (1993).

  8. See, for example, Mincer (1963) and Butz and Ward (1979).

  9. The relationship between fertility and female wage rates seems to be still empirically controversial (Andersson 2000; Hoem 2000; Engelhardt et al. 2004; Vikat 2004).

  10. The positive effect engendered by a reduction in the relative price of bought-in childcare is argued by Ermisch (1989) and Ahn and Mira (2002).

  11. Individual’s additional utility from the number of their children, v i (n), may differ between men and women taking into account the biological difference such as the women’s time devoted to pregnancy, giving birth, and the social norms or culture that impose on them other particular roles regarding childrearing.

  12. This assumption is justified if Y > w under the model in which mother and father’s time for childcare are perfect substitution and family members can choose their time allocation between labor supply and childcare. However, under Y > w and as long as women’s time and men’s time are substitutable, even if we ease the assumption of perfect substitution, the main results of this paper are unaffected. From the fact that there is no country where the average female wage rate is as high as the average male wage rate even in OECD countries, we can assume women’s lower opportunity cost of their time than that of men (OECD Employment Outlook 2010).

  13. Specific examples are the perinatal and lactation period.

  14. Because the scale effect in childcare is sensitive to the timing of birth, Cigno and Pettini (2002) assume the possible situation in which the negative and positive effects offset each other so that they can simply assume constant returns to scale in production of childcare. This assumption is also employed in the analysis of family policies such as in Apps and Rees (2004).

  15. The idea of the Pareto weights within a household was introduced by the studies on the collective model of Chiappori (1988, 1992). According to his studies, the distributional rule is affected by exogenous variables such as wages and marital institutions. The recent study of Basu (2006) succeeded in endogenizing the distributional rule, taking account of the feedback effect of household choices themselves on the power balance in the household. The effect of fertility choice, however, is not considered in his analysis. The fact that an increase in the wife’s income relative to her husband’s brings her more autonomy in household decision making is also supported in many empirical studies such as those of Browning et al. (1994), Hoddinott and Haddad (1995), and Lundberg et al. (1997). Zamora (2011) suggested that fertility choice affects the distributional rule, showing that the choice of female labor participation has a significant effect on the rule. Moreover, relative earning is also one of the components in the indicator of the degree of women’s economic autonomy used by the international institutions (e.g., gender empowerment measures in Human Development Report (UNDP 2007)).

  16. Feyrer et al. (2008) pointed out that women’s status is affected not only by the common economic factors but also by the longstanding cultural and social ones. Regarding the point of the social factor in gender bargaining power, we assume that peer pressure reflecting the relevant norms shapes the behaviors of future parents. The empirical works such as those of Goldstein et al. (2003), Lutz et al. (2006), and Testa and Grilli (2006) showed the significant correlation between the actual fertility outcome and the young generations’ standards relating parental attitude.

  17. See for example, Lundberg and Pollak (1993).

  18. The classification into these two cases is reasonable from the empirical point of view since they are observed in both developed and developing countries. For example, Mason and Taj (1987) surveyed the existing empirical evidences of developing countries including the both cases and concluded that, on average, men’s demands for children are likely to be larger than those of their wives. We also examined the case of a = 1, the conventional common preference model, as a benchmark case in the previous version of this paper so as to show the well-known positive effect of a reduction in the price of bought-in childcare on fertility outcomes.

  19. Ngom (1997) found evidence that men desire to have more children than women do in Ghana and Kenya. According to Westoff’s (2010) studies on ideal family sizes in developing countries, men report a larger ideal number of children on average in 32 out of 33 countries. As Fig. 1 indicates, this trend in reproductive preferences can also be seen in developed countries (Testa 2006). Based on these facts, Maitra (2004) has formulated a model in which women are more likely to bear the cost of having children.

  20. The possible interpretation of the bargaining power function in Fig. 2b is as follows. If other couples have a single child on average, it reduces the wife’s time in market work. A young couple then anticipates that the wife would spend as much time for childcare as other wives do and, thus, women’s less expected labor income. Consequently, it leads to the lower bargaining power of young women, though its decline is relatively small. Once the other couples have more than a certain number of children, however, the young couple expects that much of the wife’s time will be occupied by childcare. As a result, the wife’s bargaining power drastically decreases. After this sharp decline in her power, the wife finally gives up the whole power within her households moderately because of other couples’ fertility choices. In this situation, the multiple equilibria in Fig. 2b are likely to emerge in the economy.

  21. In the analysis of Iyigun and Walsh (2007), the woman’s strategic behavior of educational investment improves her utility in the case of a breakdown in the marital agreement, i.e., their bargaining power, and this behavior induces a declining fertility rate because of the higher opportunity cost of having and rearing children.

  22. High fertility may reinforce the husband’s loyalty and economic support to the wife, who will then be more likely to avoid divorce and abandonment by her husband (Mernissi 1975). Furthermore, in some societies, women’s own value may be heightened by bearing numerous children (Blake 1965). These could be among the factors causing women to prefer a greater number of children. Similar relationships between parental preferences are also found in developed countries (Thomson et al. 1990; Testa 2006).

  23. Since \({\partial \psi \left( {n;w,Y,g_S } \right)} / {\partial g_S }=-{\theta^ \prime wn} / Y\cdot {\partial \widetilde{t}} / {\partial g_S }\), \({\partial \widetilde{t}} / {\partial g_S <0}\) gives \({\partial \psi } / {\partial g_S }>0\).

  24. According to World Bank data (2012), TFR of year 2010 also indicate more than 1.75 in some of the countries where women prefer a larger family size than men in Fig. 1 (Belgium, Denmark, Finland, France, Ireland, The Netherlands, Sweden).

References

  • Ahn N, Mira P (2002) A note on the changing relationship between fertility and female employment rates in developed countries. J Popul Econ 15:667–682

    Article  Google Scholar 

  • Andersson G (2000) The impact of labor-force participation on childbearing behaviour: pro-cyclical fertility in Sweden during the 1980s and the 1990s. Eur J Popul 16:293–333

    Article  Google Scholar 

  • Apps P, Rees R (2004) Fertility, taxation and family policy. Scand J Econ 106:745–763

    Article  Google Scholar 

  • Basu K (2006) Gender and say: a model of household behavior with endogenously determined balance of power. Econ J 116:558–580

    Article  Google Scholar 

  • Blake J (1965) Demographic science and the redirection of population policy. J Chron Dis 18:1181–1200

    Article  Google Scholar 

  • Browning M, Bourguignon F, Chiappori PA, Lechene V (1994) Income and outcomes: a structural model of intrahousehold allocation. J Polit Econ 102:1067–1096

    Article  Google Scholar 

  • Butz P, Ward P (1979) The emergence of countercyclical US fertility. Am Econ Rev 69:318–328

    Google Scholar 

  • Chiappori PA (1988) Rational household labor supply. Econometrica 56:63–89

    Article  Google Scholar 

  • Chiappori PA (1992) Collective labor supply and welfare. J Polit Econ 100:437–467

    Article  Google Scholar 

  • Cigno A (2008) A gender-neutral approach to gender issues. In: Bettio F, Verashchagina A (eds) Frontiers in the economics and gender. Routledge, London, pp 45–56

    Google Scholar 

  • Cigno A (2012) Marriage as a commitment device. Rev Econ Household 10:193–213

    Article  Google Scholar 

  • Cigno A, Pettini A (2002) Taxing family size and subsidizing child-specific commodities? J Public Econ 84:75–90

    Article  Google Scholar 

  • Cigno A, Werding M (2007) Children and pensions, CESifo book series. The MIT, Massachusetts

    Google Scholar 

  • Doepke M, Tertilt M (2009) Women’s liberation: what’s in it for men? Q J Econ 124:1541–1591

    Article  Google Scholar 

  • Engelhardt H, Kögel T, Prskawetz A (2004) Fertility and women’s employment reconsidered: a macro-level time-series analysis for developed countries, 1960–2000. Pop Stud-J Demog 58:109–120

    Article  Google Scholar 

  • Ermisch J (1989) Purchased child care, optimal family size and mother’s employment theory and econometric analysis. J Popul Econ 2:79–102

    Article  Google Scholar 

  • Eswaran M (2002) The empowerment of women, fertility, and child mortality: towards a theoretical analysis. J Popul Econ 15:433–454

    Article  Google Scholar 

  • Fernandez R (2010) Women’s rights and development. DRI Working Paper No 68, New York University

  • Fernandez R, Fogli A, Olivetti C (2004) Mothers and sons: preference formation and female labor force dynamics. Q J Econ 119:1249–1299

    Article  Google Scholar 

  • Feyrer J, Sacerdote B, Stern A (2008) Will the stork return to Europe and Japan? Understanding fertility within developed nations. J Econ Perspect 22:3–22

    Article  Google Scholar 

  • Folbre N (1997) Gender coalitions: extrafamily influences on intrafamily inequality. In: Haddad L, Hoddinott J, Alderman H (eds) Intrahousehold resource allocation in developing countries: models, methods, and policy. Johns Hopkins University Press, Baltimore, pp 263–274

    Google Scholar 

  • Goldstein J, Lutz W, Testa MR (2003) The emergence of sub-replacement family size ideals in Europe. Popul Res Policy Rev 22:479–496

    Article  Google Scholar 

  • Gustafsson S (1992) Separate taxation and married women’s labor supply: a comparison of West Germany and Sweden. J Popul Econ 5:61–85

    Article  Google Scholar 

  • Hener T (2010) Do couples bargain over fertility? Evidence based on child preference data. Working Paper, Ifo Institute for Economic Research, University of Munich

  • Hoddinott J, Haddad L (1995) Does female income share influence household expenditures? Evidence from Côte d’Ivoire. Oxford B Econ Stat 75:77–95

    Article  Google Scholar 

  • Hoem B (2000) Entry into motherhood in Sweden: the influence of economic factors on the rise and fall in fertility 1986–1997. Demogr Res 2

    Article  Google Scholar 

  • Ilmakunnas S (1997) Public policy and childcare choice. In: Persson I, Jonung C (eds) Economics of the family and family policies. Routledge, London, pp 178–193

    Google Scholar 

  • Iyigun M, Walsh R (2007) Endogenous gender power, household labor supply and the demographic transition. J Dev Econ 82:138–155

    Article  Google Scholar 

  • Konrad KA, Lommerud KE (2000) The bargaining family revisited. Can J Econ 33:471–487

    Article  Google Scholar 

  • Lehrer EL (1996) Religion as a determinant of marital fertility. J Popul Econ 9:173–196

    Article  Google Scholar 

  • Lundberg S, Pollak RA (1993) Separate spheres bargaining and the marriage market. J Polit Econ 101:988–1010

    Article  Google Scholar 

  • Lundberg S, Pollak RA (1996) Bargaining and distribution in marriage. J Econ Perspect 10:139–158

    Article  Google Scholar 

  • Lundberg S, Pollak RA (2003) Efficiency in marriage. Rev Econ Household 1:153–167

    Article  Google Scholar 

  • Lundberg S, Pollak RA, Terence TJ (1997) Do husbands and wives pool their resources? Evidence from the United Kingdom child benefit. J Hum Resour 32:463–480

    Article  Google Scholar 

  • Lutz W, Skirbekk V, Testa M (2006) The low-fertility trap hypothesis: forces that may lead to further postponement and fewer births in Europe. Vienna Yearb Popul Res 4:167–192

    Google Scholar 

  • Maitra P (2004) Parental bargaining, health inputs and child mortality in India. J Health Econ 23:259–291

    Article  Google Scholar 

  • Manser M, Brown M (1980) Marriage and household decision making: a bargaining analysis. Int Econ Rev 21:31–44

    Article  Google Scholar 

  • Mason K, Taj A (1987) Differences between women’s and men’s reproductive goals in developing countries. Popul Dev Rev 13:611–638

    Article  Google Scholar 

  • McElroy M, Horney MJ (1981) Nash-bargained household decisions: toward a generalization of the theory of demand. Int Econ Rev 22:333–349

    Article  Google Scholar 

  • Mernissi F (1975) Obstacles to family planning practice in urban Morocco. Stud Family Plann 6:418–425

    Article  Google Scholar 

  • Mincer J (1963) Market prices, opportunity costs, and income e?ects. In: Christ C et al (ed) Measurement in economics: studies in mathematical economics and econometrics in memory of Yehuda Grufeld. Stanford University Press, Stanford, pp 67–82

    Google Scholar 

  • Munshi K, Myaux J (2006) Social norms and the fertility transition. J Dev Econ 80:1–38

    Article  Google Scholar 

  • Ngom V (1997) Men’s unmet need for family planning: implications for African fertility transitions. Stud Family Plann 28:192–202

    Article  Google Scholar 

  • OECD (2010) OECD employment outlook. Paris OECD

  • Rainer H (2008) Gender discrimination and efficiency in marriage: the bargaining family under scrutiny. J Popul Econ 21:305–329

    Article  Google Scholar 

  • Rasul I (2008) Household bargaining over fertility: theory and evidence from Malaysia. J Dev Econ 86:215–241

    Article  Google Scholar 

  • Testa M (2006) Childbearing preferences and family issues in Europe. Special Eurobarometer 253, 65: European Commission, Brussels

  • Testa M, Grilli L (2006) The influence of childbearing regional contexts on ideal family size in Europe. Population 61:109–138 (English edition)

    Google Scholar 

  • Thomson E, Mcdonald E, Bumpass LL (1990) Fertility desires and fertility: hers, his, and theirs. Demography 27:579–588

    Article  Google Scholar 

  • United Nations Development Programme (2007) UNDP Human Development Report 2007/2008: fighting climate change: human solidarity in a divided world. Palgrave Macmillan, New York

  • Vagstad S (2001) On private incentives to acquire household production skills. J Popul Econ 14:301–312

    Article  Google Scholar 

  • Vikat A (2004) Women’s labor force attachment and childbearing in Finland. Demogr Res Special Collection 3:177–212

    Article  Google Scholar 

  • Voas D (2003) Conflicting preferences: a reason fertility tends to be too high or too low. Popul Dev Rev 29:626–646

    Article  Google Scholar 

  • Westoff CF (2010) Desired number of children: 2000–2008. DHS Comparative Reports 25, Calverton: ICF Macro

  • World Bank (2012) World databank. http://databank.worldbank.org/ddp/home.do. Accessed 7 May 2012

  • Zamora B (2011) Does female participation affect the sharing rule? J Popul Econ 24:47–83

    Article  Google Scholar 

Download references

Acknowledgements

I would like to thank the editor, Alessandro Cigno, and two referees of this journal for their detailed and constructive comments. I am also grateful to Hikaru Ogawa, Takanori Adachi, Makoto Hirazawa, Kazutoshi Miyazawa, Emiko Usui, Akira Yakita, and the participants of the 14th Labor Economics Conference and the workshop held at Nagoya University.

Author information

Authors and Affiliations

  1. Graduate School of Economics, Nagoya University, Furocho, Chikusaku, Nagoya, 464–8601, Japan

    Mizuki Komura

Authors
  1. Mizuki Komura
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Mizuki Komura.

Additional information

Responsible editor: Alessandro Cigno

Electronic Supplementary Material

Below is the link to the electronic supplementary material.

(PDF 115 KB)

(DOC 79.0 KB)

Rights and permissions

Reprints and permissions

About this article

Cite this article

Komura, M. Fertility and endogenous gender bargaining power. J Popul Econ 26, 943–961 (2013). https://doi.org/10.1007/s00148-012-0460-6

Download citation

  • Received:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s00148-012-0460-6

Keywords

Search

Navigation