DP12531 How Far Can Economic Incentives Explain the French Fertility and Education Transition?

Author(s): David de la Croix, Faustine Perrin
Publication Date: December 2017
Keyword(s): demographic transition, education, Family macroeconomics, France, Gender Gap, Quality-Quantity Tradeoff
JEL(s): J13, N33, O11
Programme Areas: Macroeconomics and Growth
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=12531

We analyze how much a core rational-choice model can explain the temporal and spatial variation in fertility and school enrollment in France during the 19th century. The originality of our approach is in our reliance on the structural estimation of a system of first-order conditions to identify the deep parameters. Another new dimension is our use of gendered education data, allowing us to have a richer theory having implications for the gender wage and education gaps. Results indicate that the parsimonious rational-choice model explains 38 percent of the variation of fertility over time and across counties, as well as 71 percent and 83 percent of school enrollment of boys and girls, respectively. The analysis of the residuals (unexplained by the economic model) indicates that additional insights might be gained by interacting incentives with cross-county differences in family structure and cultural barriers.