Family Planning and Development: Aggregate Effects of Contraceptive Use

Tiago Cavalcanti, Cezar Santos and Georgi Kocharkov

No 332, 2018 Meeting Papers from Society for Economic Dynamics

Abstract: What is the role of family planning interventions on fertility, savings, human capital investment, and development? To examine this, endogenous unwanted fertility is embedded in an otherwise standard quantity-quality overlapping generations model of fertility and growth. The model features costly fertility control and families can (partially) insure against a fertility risk by using costly modern contraceptives. In the event of unexpected pregnancies, households can also opt to abort some pregnancies, at a cost. Given the number of children born, parents decide how much education to provide and how much to save out of their income. We fit the model to Kenyan data, implement several family planning policies and decompose their aggregate effects. Our results suggest that given a small budget (up to 0.5 percent of GDP), legalizing and subsidizing the price of abortion is a more cost-effective policy for improving long-run living standards and reducing inequality than policies that either subsidize the price of modern contraceptives or subsidize basic education.

Date: 2018
New Economics Papers: this item is included in nep-dge and nep-gro
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Related works:
Journal Article: Family Planning and Development: Aggregate Effects of Contraceptive Use (2021)
Working Paper: Family Planning and Development: Aggregate Effects of Contraceptive Use (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:red:sed018:332

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