Are Children a Risky Investment? How Cultural Risk Preferences Shape Fertility Responses to Macroeconomic Shocks
(2026) EKHS42 20261Department of Economic History
- Abstract
- This study investigates whether cultural risk preferences moderate the relationship between macroeconomic shocks — namely inflation, unemployment, and GDP contraction — and fertility across 76 developed and developing countries over the period 2000–2023. Drawing on the Becker–Tomes quantity–quality framework extended with a precautionary saving channel, I argue that more risk-averse societies treat the irreversible commitment of childbearing as a larger effective resource loss when faced with economic uncertainty, producing stronger fertility responses to adverse shocks. Using two-way fixed-effects panel regressions, I find that inflation and unemployment robustly reduce total fertility rates, while cultural risk tolerance significantly... (More)
- This study investigates whether cultural risk preferences moderate the relationship between macroeconomic shocks — namely inflation, unemployment, and GDP contraction — and fertility across 76 developed and developing countries over the period 2000–2023. Drawing on the Becker–Tomes quantity–quality framework extended with a precautionary saving channel, I argue that more risk-averse societies treat the irreversible commitment of childbearing as a larger effective resource loss when faced with economic uncertainty, producing stronger fertility responses to adverse shocks. Using two-way fixed-effects panel regressions, I find that inflation and unemployment robustly reduce total fertility rates, while cultural risk tolerance significantly buffers the negative fertility response to labour-market instability. This moderating role is concentrated among middle- and high-income countries, where precautionary motives are most operative, and is robust across multiple specification checks. These findings provide strong evidence that pro-natalist policies targeting the sources of economic uncertainty could play a meaningful role in limiting the fertility costs of macroeconomic downturns. (Less)
Please use this url to cite or link to this publication:
https://lup.lub.lu.se/student-papers/record/9245544
- author
- Giorgi, Chiara LU
- supervisor
- organization
- course
- EKHS42 20261
- year
- 2026
- type
- H2 - Master's Degree (Two Years)
- subject
- keywords
- Fertility, Cultural risk tolerance, Macroeconomic shocks
- language
- English
- id
- 9245544
- date added to LUP
- 2026-09-07 13:56:04
- date last changed
- 2026-09-07 13:56:04
@misc{9245544,
abstract = {{This study investigates whether cultural risk preferences moderate the relationship between macroeconomic shocks — namely inflation, unemployment, and GDP contraction — and fertility across 76 developed and developing countries over the period 2000–2023. Drawing on the Becker–Tomes quantity–quality framework extended with a precautionary saving channel, I argue that more risk-averse societies treat the irreversible commitment of childbearing as a larger effective resource loss when faced with economic uncertainty, producing stronger fertility responses to adverse shocks. Using two-way fixed-effects panel regressions, I find that inflation and unemployment robustly reduce total fertility rates, while cultural risk tolerance significantly buffers the negative fertility response to labour-market instability. This moderating role is concentrated among middle- and high-income countries, where precautionary motives are most operative, and is robust across multiple specification checks. These findings provide strong evidence that pro-natalist policies targeting the sources of economic uncertainty could play a meaningful role in limiting the fertility costs of macroeconomic downturns.}},
author = {{Giorgi, Chiara}},
language = {{eng}},
note = {{Student Paper}},
title = {{Are Children a Risky Investment? How Cultural Risk Preferences Shape Fertility Responses to Macroeconomic Shocks}},
year = {{2026}},
}