the impact macroeconomic instability on the fertility rate in Iranian provinces

Document Type : مقالات پژوهشی

Author

• zahra afshari

alzahra university

https://doi.org/10.22067/erd.v22i10.45526

Abstract

Extended Abstract
Introduction
The fertility transition in Iran has pass through different stages from 1972-2015.The total fertility rate (TFR) decreased from 7.7 in 1966 to around 6 in 1976.Then it rose to 7 in 1980.TFR decline to 5.5 in 1988.In 1996,thetotal fertility rate reach to 2.8,more than 50% decline. TFR has declined further and reached 2.17 in 2000, and 1.9 in 2012 i.e. below replacement rate (Abbasi-Shavazi, et.al, 2006). Moreover the figures reveal that in 2012, in 26 out of 30 provinces of Iran TFR was below replacement rate. Fertility reduction in Iran is unique in speed of decline. The socio- economic planners believe that the decreasing pattern of total fertility rate in Iran may have adverse effect on socio- economic development of Iran, exploring the determinants of sharp decline in total fertility rate is crucial.
Theoretical frame work
Most analyses of childbearing decisions have their root in the economic model pioneered by Becker (1960) and Leibenstein (1957), where demand for children is a function of their costs and of individuals’ preferences, for a given income. Underlying this model is the notion that children are a special type of capital good, i.e. a long-lived asset that produces a flow of services that enter the utility function of parents.
There are many socio- economic candidates for explaining this trend, including socio-economic development. Furthermore,Several key strategies contributed to rapid fertility decline ,including the role of women,the public education campaigns, population family planning , economic instability.
Methodology
This article provides a framework for analyzing the impact of macroeconomic instability on TFR in Iranian provinces through a panel data econometric model for the 2006-2012 periods. For this purpose two key determinant of business cycles, i.e. the rates of unemployment and GDP per capita growth were used. The model is elaborated with the Eviews 7 software package. First, the Limer test accept the panel data versus pooled data. Second, Hausman test reject random effect versus the fixed effect.
Results & Discussion
The results reveal that total fertility rate was moved positively with the rate of growth of per capita income, and negatively with unemployment rate. Therefore ttotal fertility rate revealed a procyclical behavior in the provinces of Iran. These results confirm the Pennsylvanian school of thoughts. Becker (1981) argue that the rise in income induces the fertility decline, because the positive income effect that is generated by increase in income is dominated by rising opportunity cost of children. In Iran economic instability that mirrored on two digit unemployment rate during the period under consideration, postpone the marriage and child bearing time to an appropriate economic situation, can be consider as a major explanatory factor for the high speed of total fertility rate in Iran. This is consistent with the results by other authors in other countries (Sobotka T, et.al,2011, Adsera and Menendez, 2011) Moreover, the model shows a positive relationship between female labor force participation and fertility in Iranian provinces during the period under consideration.Various authors(Nourouzi, Ladan, 2008, Mehregan, Nader ,et al, 2010) find a negative correlation between labor force participation of women and total fertiliy rate in Iran , but our findings based on provincial data reveals that this correlation turened to a positive value . This result is consistent with The evidences from OECD countries (Ahn and Mira,2002,,Bettio and Villa, 1998, Engelhardt and Prskawetz, 2004). These authors show that the countries that have lowest level of total fertility rate are those with relatively low levels of female labor force participation rates.
Our findings show a significant negative relationship between GDP per capita and fertility in Iranian provinces, Economic development through increasing the women higher education, increased the female labor force participation rate. Increasing the share of women with higher education, postpone the marriage age of woman and restructure the decision making within the family, decrease total fertility rate. We may conclude that economic development through increasing the share of women with higher education, and the average age of women in first marriage tend to decreased total fertility rate, which confirm the Leibenstein modernization school.
Conclusions & Suggestions
In Iran, from one hand, hand, the signs of movement toward a developed countries (i.e. GDP per capita growth, Educational progress especially among women, labor force participation of women) is apparent. These progresses caused TFR to decline. On the other hand the planners believe that the current trend of fertility is a burden to sustainable development in Iran. Therefore, the policies should be directed toward an optimal total fertility rate. The results indicates that unemployment is not only has a negative impact on the current family income, but also is a treat for future employment of the family. The unemployment persistence, increase the age of marriage, postpone child bearing, and the number of children. Therefore, unemployment not only affect the timing of fertility, but also decrease TFR. Therefore, with respect to the important role of economic instability on total fertility rate, implementing policies that stabilized the economy is required .Moreover, with respect to irreversible nature of development, in order to diminish the adverse effect of this process on total fertility rate, labor regulations should move toward a family supportive regulations. , otherwise the current fertility trend will be unavoidable.

Keywords

• fertility
• GDP per capita growth
• the labor force participation of women

References

Abbasi-Shavazi, M, (2001). Below-replacement fertility in Iran: Progress and prospects. Paper presented at the IUSSP workshop on low fertility: Trends, theories and policies, Tokyo, 21-23 (in Persian)

Abbasi-Shavazi, M, Askari,M.J.,Bigdeli,M.T.,Kalantari,S.,Alizadeh Aghdam,Mohammad Bagher, (2006),The Relation between Fertility Rate and Socio- Economic Development,Refahe-Ejtemaee Research Journal, No, 5

Adsera A (2004) Changing fertility rates in developed countries. The impact of labor market institutions. J Popul Econ 17(1):17–43.

Adsera, A. (2005) “Differences in Desired and Actual Fertility: An Economic Analysis of the Spanish Case”. Forschungsinstitut zur Zukunft der Arbeit,Discussion Paper No. 1584.

Adsera, A., (2005). Vanishing children: From high unemployment to low fertility in developed countries. American Economic Review Papers and Proceedings 95, 189–193.

Adsera, A., ( 2011). Where are the babies? Labor market conditions and fertility in europe. European Journal of Population 27, 1–32.

Adsera, A., Menendez, A., (2011). Fertility changes in Latin America in the context of economic uncertainty. Population Studies 65/1, 37–56.

Ahn, N., Mira, P., ( 2002). A note on the changing relationship between fertility and female employment rates in developed countries. Journal of Population Economics 15, 667–682

Amani, M., (1970), Births and fertility in Iran. Division of Population Research, Institute for Social Studies and Research, University of Tehran, Tehran

Becker, Gary S, ( 1960,)"An Economic Analysis of Fertility", Demographic and Economic Change in Developed Countries, a Conference of the Universities, National Bureau Committee for Economic Research. Princeton, NJ: Princeton University Press.

Becker, G. S., (1993), a Treatise on the Family. Cambridge, Massachusetts: Harvard University Press.Becker,

Becker, Gary S, (1964), Human Capital: A Theoretical and Empirical Analysis, with Special Reference to Education. Chicago, University of Chicago Press.

Bettio, F., Villa, P., ( 1998). A Mediterranean perspective on the break-down of the relationship lationship between participation and fertility. Cambridge Journal of Economics 22, 131–171.

Black, D, Kolesnikova N, Sanders S, Taylor L, (2013), Are children “normal”? Rev Econ Stat 95(1):21–33.

BruecknerM, Schwandt H, (2014), Income and population growth. Econ J, 10.1111/ecoj.12152.

Butz, W., Ward, M., ( 1979). The emergence of countercyclical US fertility. American Economic Review 49, 318–328

Easterlin, Richard, (1966), on the relation of economic factors to recent and projected fertility changes, Demography March 1966, Volume 3, Issue 1, pp 131-153March

Easterlin, Richard, ( 1975),An Economic Framework for Fertility Analysis Studies in Family Planning Vol. 6, No. 3 (Mar., 1975), pp. 54-63Published by: Population Council

Easterlin, Richard A, (1978), the economics and sociology of fertility: A synthesis- Center for Advanced Study in the Behavioral Sciences 1978

Ermisch JF, ( 1980), Time costs, aspirations and the effect of economic growth on German fertility. Oxford Bull Econ Stat 42(2):125–143.

Ermisch, J, (1988),Econometric analysis of birth rate dynamics in Britain, The Journal of Human ResourcesVol. 23, No. 4 (Autumn, 1988), pp. 563-576

Engelhardt, H., Prskawetz, A., ( 2004). On the changing correlation between fertility and female employment over space and time.European Journal of Population 20,35-62

Galbraith VL, Thomas DS, ( 1941),Birth rates and the interwar business cycles. J Am StatAssoc 36(216):465–476.

Gillis, J.R. ; Tilly, L.A. ; Levine, D. 1992, The European experience of declining fFertility, 1850 1970: the quiet revolution, Cambridge [etc.]: Blackwell

Gillis, M., Perkins, D. H., Roemer, M., & Snodgrass, D. R. (1992). Economics of Development, New York: W. W. Norton & Company, Inc.

Heckman, J., Willis, R., (1975). Estimation of a stochastic model of reproduction: An Econometric approach. In: Terleckyj, N. (Ed.), Household production and consumption.

Hoffman, S. D., & Averett, S. L., (2010). Women and the Economy: Family, Work and Pay, Boston: Addison-Wesley.

Hoynes H, Miller DL, Schaller J, (2012), who suffers during recessions? J Econ Perspective 26(3):27–47

Lee, R, (1990), The demographic response to economic crisis in historical and contemporary populations. Popul Bull UN (29):1–15.

Leibenstein, Harvey, ( 1974), an Interpretation of the Economic Theory of Fertility: Promising Path or Blind Alley, Journal of Economic Literature, VOI. 12, No. 2, pp. 457-479.

Lewis, H. G., (1973), On the Interaction between the Quantity and Quality of Children. Journal of Political Economy, 1973, vol.12

Macunovich, DJ, (1996), Relative income and price of time: Exploring their effects on U.S. Fertility and female labor force participation. Popul Dev Rev 22:223–257

Malthus, Robert, (1798), An Essay on the Principle of Population: Library of Economics" (description), Liberty Fund, Inc., 2000, EconLib.org webpage

Mehrabani,Vahid, (2014),Family Income and Demand For Child, Theoretical model and some evidences, Tahghighat–E-Eghtesadi Journal, Tehran University,49, N0.,1.1 (in Persian)

Mehregan,Nader,Rezaee,Rouhollah,Mousaee,Maysam, (2010)Fertility rate and Labor Force Participation of Women in MENA Countries, an –Dar-Tousee va Siyasat Quarterly Journal,N0.2, (29) (in Persian)

Nouruzi, Ladan, (2008),A survey on the Impact of Socio-Economic Factors on the Fertility rate of Women in Iran,Barnameh and Budjet.No, 30, (in Persian)

Moeeni, Maryam, Pour reza, A, Heydari H,Torabi F, (2014). International Journal of Health Policy & Management (IJHPM), Vol. 3, p. 135,

Robinson, Warren C., (1997).the Economic Theory of Fertility over Three Decades, Population Studies: A Journal of Demography Volume, Issue 1, 1997

Sanderson, Warren, (1979).Quantitative aspects of marriage, fertility and family limitation in nineteenth century America: Another application of the Coale specifications, 1979- Demography, 1979 – Springer

Sanderson, Warren C., (1976), New Estimates and Interpretations of the Decline in Fertility of White Women in the United States, 1800-1920

Silver M (1965) Births, marriages, and business cycles in the United States. J Polit Econ73 (3):237–255.

Schaller J, ( 2012), Booms, busts, and fertility: Testing the Becker model using gender specific labor demand. Working paper (Univ of Arizona, Tucson, AZ).

Sobotka T, Skirbekk V, Philipov D (2011) Economic recession and fertility in the developed world. Popul Dev Rev 37(2):267–306.

United Nations, (2001), World Population Prospects: The 2000 Revision, vol. I, Comprehensive Tables

Willis, R. J., (1987). What Have We Learned from the Economics of the Family? The American Economic Review, 77(2), 68-81.

Yule GU (1906), on the changes in the marriage-and birth-rates in England and Wales during the past half century; with an inquiry as to their probable causes. Applied Stat 69(1):88–147.