The impact of individual and aggregate unemployment on fertility in Norway

Abstract

Continuous-time hazard models are estimated from register-based birth, migration, education and unemployment histories for the complete Norwegian population, linked with aggregate data for municipalities. The analysis covers the period 1992-98. First-birth rates are slightly higher among women who had been unemployed twelve months before than among others, whereas higher-order birth rates are slightly lower. Although men’s unemployment has a more pronounced negative effect, according to paternity rate models, the overall conclusion is that unemployment in Norway has had a negligible impact on fertility through individual-level effects. Aggregate-level effects are more important. Higher-order birth rates are lower in municipalities where men’s or women’s unemployment is high than elsewhere. All in all, the peak unemployment level of 6% experienced in 1993 is found to be associated with a reduction of about 0.08 in total fertility. The results accord well with economic theories for first and higher-order births that are based on the assumption that women are still the primary caretakers.