Economic uncertainty and fertility postponement: evidence from German panel data

Abstract

This paper investigates whether economic uncertainty induces a postponement of family formation.We use data from the German Socio-Economic Panel which provides longitudinal information of economic uncertainty and fertility for the period 1984 to 2004.We employ 'objective' measures of uncertainty (unemployment, fixed-term contract, low income) as well as 'subjective' measures (the feeling that the personal economic situation is insecure).Our results suggest that there is no clear indication that economic uncertainty generally leads to a postponement of parenthood.More highly educated women tend to postpone family formation when unemployed or when they feel insecure about their personal economic situation.However, women with low educational levels accommodate themselves quite readily with motherhood when subject to labor market insecurities.

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