The Effect of Offspring's Skill Premium on Parental Fertility
Wage of offspring jump at the threshold of human capital in high-skill sectors due to skill premiums.In order to maximize their own utility,most middle-income parents(as well as a few high-income parents with less gifted children and low-income parents with more talented children)make additional investments in their children's education in order to bring children's human capital up to the desired thresholds.Under quantity-quality trade-off,the fertility of these parents is lower than the rest,and the higher the additional expenditure on children's education,the lower the parental fertility.Further,an increase in the skill premium of the offspring leads to lower fertility for a higher proportion of parents,which reduces the average fertility of the society.In general,an increase in the human capital threshold of the offspring has the same effect as described above.But if the skill premium of the offspring is very low or if the human capital threshold of the offspring is very high,the share of these parents decreases and the mean fertility of the society increases,although this is very rare in reality.Thus,increasing public investment in education while lowering the human capital threshold and reducing the extent of skill premium can be an effective policy for raising fertility.
万方数据
维普
