Human capital and fertility in Chinese clans before modern growth

Abstract

This paper studies the effect of changes in the return to human capital on the fertility–education relationship. The setting is in Anhui Province, China in the thirteenth to twentieth centuries. Over this period, key changes occurred in the civil service examination system, providing a means to test whether incentives for acquiring education influenced fertility decisions. I form an intergenerationally linked dataset from over 43,000 individuals from all social strata to examine the evidence for a child quantity–quality tradeoff. First, as the civil service examination system became more predictable and less discretionary starting in the seventeenth century, raising the return to human capital, I find evidence that households with a lower number of children had a higher chance that one of their sons would participate in the state examinations. This finding is robust to accounting for differences in resources, health, parental human capital, and demographic characteristics. Importantly, the finding is not limited to a small subset of rich households but present in the sample as a whole. Second, the negative relationship between fertility and education disappeared as the lower chance to become an official during the nineteenth century implied a decline in the return to human capital. Taken together, my findings support the hypothesis that fertility choices respond to changes in the return to human capital.