This paper presents a dynamic economic model of fertility behavior estimated with age-year-specific U.S. time-series data. The estimated model indicates that couples, on average, time their births to avoid periods when female wage rates are expected to be high, and that most of the observed effect of income and female wages on fertility rates is due to the indirect influence of these variables on couples' wage and income expectations. This paper also presents a decomposition of current fertility rates into timing and completed fertility components, allowing a comparison of current low fertility rates with couples' lifetime fertility plans. The estimates indicate that aggregate planned completed fertility is approximately equal to the fertility rate.

At this time both professional and nonprofessional opinion concerning the cause of the present fertility decline in the U.S. has moved steadily away from the simple mechanism tying economic well-being to desired fertility. An alternative mechanism through which aggregate economic activity affects fertility rates is presented. The approach follows that of previous work which has analyzed the microeconomic determinants of fertility. The distinction between male and female earnings in affecting fertility and the distinction between families with employed and those with unemployed wives is emphasized. It is shown that post-World War 2 movements in fertility rates - a rapid increase throughout the 1950s and a sharp decline thereafter - can be reconciled within this framework. An empirical model is presented as are determinants of age-specific fertility rates for the 1947-1974 period. The 2 study conclusions are the following: 1) economic models of fertility behavior that stress the distinction between income and price effects - male income and female wage effects - are successful in explaining both important features of cross-sectional variations but also aggregate movements of U.S. fertility over time; and 2) the model proposed successfully predicts both procyclical and countercyclical variations in fertility in an unified framework across age groups and over a long period of time. The current level of employment among women and variations in their ages are more than high enough to induce continuing countercyclical fertility movements.

This paper presents a dynamic economic model of fertility behavior estimated with age-year-specific U.S. time-series data. The estimated model indicates that couples, on average, time their births to avoid periods when female wage rates are expected to be high, and that most of the observed effect of income and female wages on fertility rates is due to the indirect influence of these variables on couples' wage and income expectations. This paper also presents a decomposition of current fertility rates into timing and completed fertility components, allowing a comparison of current low fertility rates with couples' lifetime fertility plans. The estimates indicate that aggregate planned completed fertility is approximately equal to the fertility rate.