The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Easterlin Hypothesis

  • Diane J. Macunovich
  • Richard A. Easterlin
Reference work entry


The economic and social fortunes of a birth cohort tend to vary as a function of that cohort’s relative size, approximated by the crude birth rate surrounding the cohort’s birth. Effects have been observed on young men’s earnings and unemployment rates, college enrolment rates, marriage and divorce, fertility, crime, and suicide rates. These effects have been found to be asymmetrical about the peak of a baby boom, and the original hypothesis has been extended to suggest a wide range of effects on the economy as a whole, from GDP growth rate, through interest rates and stock market performance, to measures of productivity.


Aggregate demand Cohort size effects Crowding Demographic transition Easterlin hypothesis Female labour force participation Fertility Inflation Interest rates Life cycle models Marriage and divorce Saving rates Relative income Relative cohort size Productivity GDP growth Unemployment rates College enrolment rates Material aspirations Preferences Crime rates Suicide rates 

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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Diane J. Macunovich
    • 1
  • Richard A. Easterlin
    • 1
  1. 1.