DP11158 Bargaining over Babies: Theory, Evidence, and Policy Implications

Author(s): Matthias Doepke, Fabian Kindermann
Publication Date: March 2016
Date Revised: November 2018
Keyword(s): Bargaining, Child Care, Fertility
JEL(s): J13
Programme Areas: Labour Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=11158

It takes a woman and a man to make a baby. This fact suggests that for a birth to take place, the parents should first agree on wanting a child. Using newly available data on fertility preferences and outcomes, we show that indeed, babies are likely to arrive only if both parents desire one. In addition, there are many couples who disagree on having babies, and in low-fertility countries women are much more likely than men to be opposed to having another child. We account for this evidence with a quantitative model of household bargaining in which the distribution of the burden of child care between mothers and fathers is a key determinant of fertility. The model implies that fertility is highly responsive to targeted policies that lower the child care burden specifically for mothers.