Re-Linking Fertility Behavior and Economic Security in Old Age

Paul Demeny has suggested that the widespread problem of below replacement fertility in Western countries is partly due to the fact that there is no longer an economic benefit from having children as exists in agricultural societies. He suggested linking social security payments to the number of children one has contributing to the system. This is problematic as it uses government policy to implement the pronatalist policy of 1 part of the population; the amount a parent invested in a child would not affect the return; social security return would vary for people who had themselves contributed the same amount; it furthers the transition from a market signal based to a command economy; future privatization of social security as has occurred in other countries would invalidate this scheme; parents would be making a very uncertain investment as all depends on the vagaries of the political process and congressional decisions and parents who abandoned or mistreated their children would still benefit even against the will of the children. The ideal way to link fertility with parental economics would be purely private. Parents would decide how much to spend on children with rights to a later return on their investment which children would repay as with a loan. It is value neutral neither promoting nor inhibiting childbearing. Such a plan would already be possible for college expenses. However the prevailing climate of values and opinions leads parents and children to believe no obligation exists and parents do not expect repayment. Governmental proclamations can affect perceptions in this regard. The scheme makes repayments more visible. The economic uncertainty of the childrens ability to pay as well as the legality of requiring children to pay for costs incurred before adulthood remain as problems with this plan

Birth rate · Development economics · Economics · Fertility · Old Age Security · Population · Sociology · Demography · Family Dynamics and Relationships · Financial Literacy, Pension, Retirement Analysis · Insurance, Mortality, Demography, Risk Management

• Theory of fertility decline

  John Charles Caldwell•Theory of fertility decline•1982

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• Re-Linking Fertility Behavior and Economic Security in Old Age

  Paul Demeny•Population and Development Review•1987

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• The Old-Age Security Motive for Fertility

  Jeffrey B Nugent•Population and Development Review•1985

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