Why did the baby boom occur?

We should thank Clarence Birdseye.  Improvements in household technology, starting in the 1920s and 1930s, made kids easier to raise:

The mystery of the baby boom has not been cracked in economics.  The fact that the baby boom was an atypical burst of fertility that punctuated a 200-year secular decline adds to the enigma.  Conventional wisdom ascribes the baby boom to the effects of the Great Depression and/or World War II.  This story has several shortcomings.  First, for the U.S. and many OECD countries, it is hard to detect a strong structural break in fertility due to the Great Depression.  Second, fertility in the U.S. and many OECD countries started to rise before World War II.  Third, at the peak of the U.S. baby boom the most fertile cohort of women was just too young for the Great Depression or World War II to have had a direct effect on them.

The story told here attributes the secular decline in fertility to the tenfold rise in real wages that occurred over this time period.  This increased the cost, in terms of foregone consumption, of raising children.  The baby boom is accounted for by the invention of labor-saving household capital or other labor-saving household products and management techniques, which occurred during the middle of the last century…the increase in the efficiency of the household sector needed to explain the baby boom is not that large.

So let’s say you think demographic aging is a problem today.  What is the policy implication?  Subsidize complex robots?  Let people genetic engineer their kids?

The above passage is from "The Baby Boom and Baby Bust," by Jeremy Greenwood, Ananth Seshadri, and Guillaume Vanderbroucke, American Economic Review, March 2005.  Here is a free and earlier version of the paper.


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