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Purchased child care, optimal family size and mother's employment Theory and econometric analysis

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Abstract

The paper develops a model of family size decisions in which couples choose explicitly a combination of mother's time and purchased childcare (e.g. childminders, nannies) for the care and rearing of children. The theoretical model implies that the impact of the mother's wage on her completed fertility varies with the market price of childcare, and that this effect increases (becoming less negative or more positive) with the level of her wage. Econometric analysis of British micro-data confirms the main predictions of the model.

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Authors and Affiliations

  1. National Institute of Economic and Social Research, 2 Dean Trench Street, SWIP 3HE, Smith Square, London, England

    John F. Ermisch

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  1. John F. Ermisch
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Additional information

I am grateful to Robert E. Wright for research assistance, and to the Economic and Social Research Council for supporting this research as part of the research programme ‘Income Inequality, Gender and Demographic Differentials’. Financial support from the Nuffield Foundation grant no. PT/9, ‘Family Formation and Employment Activity” is also gratefully acknowledged.

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Ermisch, J.F. Purchased child care, optimal family size and mother's employment Theory and econometric analysis. J Popul Econ 2, 79–102 (1989). https://doi.org/10.1007/BF00522403

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  • DOI: https://doi.org/10.1007/BF00522403

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