Schooling and demand for children

de Jee-Peng Tan

Theory predicts that schooling of children exerts a negative effect on parental fertility. Results of empirical studies related to this are mixed. This paper extends the existing discussion by evaluating the evidence from a historical perspective. The time-series data for five presently developed countries and eighteen developing countries show that, with some exceptions, overall a fairly high level of educational development seemed to be important for a decline in fertility to take place. It is suggested that costs and financing arrangements and parental aspirations for children's education may be important reasons behind the observed historical relationship. As a society modernizes the inverse relationship between child schooling and parental fertility is likely to become stronger. The high level of primary school enrollments characteristic of such societies is probably symptomatic of rising returns to education, which implies a corresponding rising payoff to investment in child quality.