More education or condoms?

We congratulate Aco and Anna for their new born baby. Now they have officially contributed to the population growth. As a present to the couple, our entry is about demand for children and education (yes – we can’t avoid talking about education again…).

Economic models generally show that, everything else constant, high population growth is bad for economic growth. For some people, high population growth is a reason why poor countries are poor (“the rich gets richer, the poor gets children”). Let’s say this is true. What makes people in poor countries have many children?

According to the demographers’ view, the answer is unmet needs for contraception. Since they are poor, they can’t afford to buy contraceptives. Hence, the appropriate intervention would be family planning campaign.

Many economists reject this idea. Even in poor countries, condoms cost no more than cigarette or coke (Easterly 2001). So, if they want to reduce the number of children, poor people can in fact afford to do so. This means that high birth rate in poor countries are actually desired. The desired fertility argument (Pritchett 1994) is based on the fact that some markets are missing or imperfect: labor, insurance and even goods market. That makes poor families rely on their children for cheap workers and old-age social security.

Only when the income level is higher, people will demand fewer children. Higher level of national income usually correlates with more availability of formal insurance system. Higher income can also be translated to higher level of parents’ education. This will give more opportunity to enter the labor market, so there will be a trade-off between working and childbearing which then lead to a substitution between quantity and quality of children. We can also say that when people are more educated, the effectiveness of contraceptives will also be increased (smarter people knows better how to put condoms or calculate women’s fertile period, eh?).

In short, development is the best contraceptive, said economists. Or, in a narrower version, education is a good, if not the best, contraceptive.

How true is such premise? I am currently doing a research on that.* Using household data from the Demographic and Health Survey, surprisingly, I found that there is no significant correlation between mother’s (as well as father’s) years of education and number of children.** No such correlation also exists between education and ideal number of children.

The data does not allow me to test the impact of education on the labor market participation. But let’s assume it to be positive. The reason must be that education does not explain contraceptive use. And yes, the data confirms that. I did not find any positive and significant impact of education on the probability of using modern contraceptives such as periodic abstinence or birth pills. There is only a marginally significant impact of education on the probability of condoms.

So does that mean that economists or the pro-education camp lost the intellectual battle?

Can’t say that too fast. The thing is the survey was conducted in 2002/03. Three decades after the family planning campaigns by the Indonesian government (BKKBN) has been considered success. Thanks to the campaign, (poor) people have had the knowledge on and access to contraceptives, regardless of their education level. You don’t need to be that smart to know where to buy condoms or pills and how to use them.

Put it more scientifically, we don’t have the counterfactuals. What would have happened if there was no family planning campaign in the ‘70s-80s? Maybe we can ask our colleague Arya Gaduh to conduct a randomized experience to answer such question.

Notes:

*) The research paper is currently being written. I will post an update if it is available.

**) For the methodology-oriented people, I have corrected the reverse causality and omitted variable bias by applying 2-stage least square estimation, using quarter of birth as the instruments (see Angrist and Krueger 1992).

Fertility | Education | Demand for children