Fertility and the real exchange rate

Description

"We use a quinquennial data set covering 87 countries between 1975 and 2005 to investigate the relationship between fertility and the real effective exchange rate. Theoretically a country experiencing a decline in its fertility rate can be expected to have higher savings, lower investment, a current account surplus, and accordingly a real depreciation. We test and confirm this hypothesis, controlling for a host of potential determinants such as PPP deviations and the Balassa-Samuelson effect. We find a statistically significant and robust link between fertility and the exchange rate. Our point-estimate is that a decline in the fertility rate of one child per woman is associated with a depreciation of approximately .15% in the real effective exchange rate"--National Bureau of Economic Research web site.

Subjects

Series Statement

• NBER working paper series -- working paper 13263
• Working paper series (National Bureau of Economic Research : Online) -- working paper no. 13263.

Links

• External source