Fertility Choices with Career Risk

[2503.02237] Fertility Choices with Career Risk Skip to main content Search Submit Donate Log in Economics > Theoretical Economics arXiv:2503.02237 (econ) [Submitted on 4 Mar 2025 ( v1 ), last revised 25 Aug 2026 (this version, v3)] Title: Fertility Choices with Career Risk Authors: Ruiwu Liu View PDF HTML (experimental) Abstract: Couples decide whether to have children before knowing the persistent career loss generated by parenthood. After the loss is realized, household resources are renegotiated and individual market earnings partly determine outside options. This limited-commitment friction places a disproportionate share of female earnings risk on the wife even when expected household resources are unchanged. We embed this mechanism in a generalized-Nash fertility bargain. The model has a unique positive agreement whenever both spouses have positive marginal gains at zero fertility. A larger expected child penalty and greater career-loss risk reduce agreed fertility. A higher loading of own earnings into outside options reduces fertility precisely when the wife's participation margin dominates the husband's corresponding gain. Insurance against the unexpected component of the career loss raises fertility without subsidizing its mean, whereas a conventional per-child transfer operates only through expected cost. A full-commitment benchmark isolates the risk-sharing distortion. In an illustrative discrete-parity exercise, rising career risk lowers desired family size from three children to two and then one, while partial earnings-loss insurance can restore the three-child outcome. These results identify a policy margin that is not available in a deterministic participation-constraint model: insurance against the distribution of the child penalty. Subjects: Theoretical Economics (econ.TH) Cite as: arXiv:2503.02237 [econ.TH] (or arXiv:2503.02237v3 [econ.TH] for this version) https://doi.org/10.48550/arXiv.2503.02237 Focus to learn more arXiv-issued DOI via DataCite Submission history From: Ruiwu Liu [ view email ] [v1] Tue, 4 Mar 2025 03:21:31 UTC (430 KB) [v2] Sat, 22 Aug 2026 09:38:23 UTC (10 KB) [v3] Tue, 25 Aug 2026 03:07:36 UTC (9 KB) Full-text links: Access Paper: View PDF HTML (experimental) TeX Source view license Current browse context: econ.TH < prev | next > new | recent | 2025-03 Change to browse by: econ References & Citations SciX Google Scholar Semantic Scholar export BibTeX citation Bookmark Bibliographic Tools Bibliographic and Citation Tools Bibliographic Explorer Toggle Bibliographic Explorer ( What is the Explorer? ) Connected Papers Toggle Connected Papers ( What is Connected Papers? ) Litmaps Toggle Litmaps ( What is Litmaps? ) scite.ai Toggle scite Smart Citations ( What are Smart Citations? ) Code, Data, Media Code, Data and Media Associated with this Article alphaXiv Toggle alphaXiv ( What is alphaXiv? ) Links to Code Toggle CatalyzeX Code Finder for Papers ( What is CatalyzeX? ) DagsHub Toggle DagsHub ( What is DagsHub? ) GotitPub Toggle Gotit.pub ( What is GotitPub? ) Huggingface Toggle Hugging Face ( What is Huggingface? ) ScienceCast Toggle ScienceCast ( What is ScienceCast? ) Demos Demos Replicate Toggle Replicate ( What is Replicate? ) Spaces Toggle Hugging Face Spaces ( What is Spaces? ) Spaces Toggle TXYZ.AI ( What is TXYZ.AI? ) Related Papers Recommenders and Search Tools Link to Influence Flower Influence Flower ( What are Influence Flowers? ) Core recommender toggle CORE Recommender ( What is CORE? ) Author Venue Institution Topic About arXivLabs arXivLabs: experimental projects with community collaborators arXivLabs is a framework that allows collaborators to develop and share new arXiv features directly on our website. Both individuals and organizations that work with arXivLabs have embraced and accepted our values of openness, community, excellence, and user data privacy. arXiv is committed to these values and only works with partners that adhere to them. Have an idea for a project that will add value for arXiv's community? Learn more about arXivLabs . Which authors of this paper are endorsers? | Disable MathJax ( What is MathJax? ) We gratefully acknowledge support from our major funders , member institutions , and all contributors. About · Help · Contact · Subscribe · Copyright · Privacy · Accessibility · Operational Status (opens in new tab)

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