The relationship between unemployment and fertility in Italy

Abstract

(ProQuest: ... denotes formulae omitted.)1. PremiseDuring the last four decades of the 20th century, the average total fertility rate (TFR) has continuously dropped in Europe, as it generally has in Organization for Economic Cooperation and Development (OECD) countries. The aggregate trend covers considerable differences across Europe, with the main differences appearing between northern and southern European countries (Eurostat 2012).During the same period, important changes have also occurred in the labour market arrangements of both men and women, with changes in individuals' and couples' economic conditions. Whereas by the 1980s the fall in fertility was coupled with a rise in female employment, since the late 1980s the fall has been accompanied by a rise in unemployment, particularly among women.Explaining the determinants of such a fall in fertility and the links with changes in the labour market statuses of both men and women has become a major topic over the last years (D'Addio and Mira d'Ercole 2005; Kreyenfeld 2010).The rise in unemployment for women and men in southern and central European countries that occurred during the 1990s has been proposed as an explanation for the more pronounced decrease in the TFR in these countries, as in other countries with low female labour force participation rates (Ahn and Mira 2002; Adsera 2005; Engelhardt and Prskawetz 2004). This evidence highlights the need to further examine the role of unemployment in fertility behaviour.This paper seeks to describe the connections between fertility and unemployment in Italy from a gender-based and geographic perspective. Italian workers have experienced a rising trend of unemployment - with gender and regional differences - since the mid-nineties, resulting in a feeling of uncertainty about the future. We are in agreement with the hypothesis that macro-level economic conditions are likely to be related to fertility (Brewster and Rindfuss 2000): in particular, economic uncertainty can induce a short-term reduction in fertility that is presumably due to the postponement of decisions to have an (additional) child until the economy recovers.We utilised time series of aggregate data on fertility and unemployment during the interval 1995-2012, which includes the period of economic downturn that began at the end of 2007.We began from the hypothesis that the connection between unemployment and fertility differs among the various Italian regions, and we used a regression dynamic model to evaluate whether changes in fertility in different Italian geographic areas are more related to changes in male or female unemployment, as well as the strength of the link. Moreover, we paid particular attention to specific temporal links between the two series in different geographical areas.The structure of the paper is as follows:- Discussion of the literature and previous research on the relationship between fertility and unemployment of both men and women. We utilised aggregate data, but we also referred to studies of individual-level data to understand how the issue has been addressed by different approaches;- Discussion of these relationships in Italy within the European context;- Methodological approach and analysis of aggregate trends of fertility and unemployment in Italy by gender and geographic area; and- Discussion of the results.2. Unemployment and fertility: A complex relationshipA modern discussion on fertility in developed countries began in the 1960s and focused on the importance of socio-economic factors at the community or country level, 4 the incompatibility between work and family, increasing female education, and the roles of women in different contexts related to specific welfare policies (Oppenheimer 1988; McDonald 2006; Pison 2009).The decrease in fertility rates in the 1960s and 1970s in most industrialised economies was correlated with an increase in female employment (Adsera 2004). …