Affiliation:
1. Crawford School of Public Policy Australian National University Canberra
Abstract
AbstractThis article examines a new era of models predicting fertility decline reversal as female‐to‐male wages rise. Standard microeconomic frameworks and diagrams simplify theoretical concepts for students and policymakers. The analysis reveals how demand for children may increase when households substitute childcare for women's time. An income effect dominates when responsiveness of the input mix and preference for children are high. Challenging conventional assumptions unveils the importance of gender inequality at home, economies of scale in raising children, and market‐determined childcare prices. The findings suggest that household taxation and preferences influence how childcare subsidies and paid maternity leave shape fertility upturn.
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