Demographers have seldom been good prophets. In 1798 Thomas Malthus, the founder of modern demography, based his famous Essay on the principle of population on the fact that American experience showed that “population, when unchecked, goes on doubling itself every twenty-five years.” Malthus was right about America in the eighteenth century, but by 1820 the American birth rate had begun to fall and by 1900 American women were having only half as many children as they had when Malthus wrote. American fertility did not decline because of food shortages, which Malthus had seen as the only effective check on population growth. The decline may have had something to do with “moral restraint,” which was the other factor Malthus thought capable of curtailing population growth, but nothing Malthus wrote explains why Americans should have exercised more restraint in the nineteenth century than they had in the eighteenth. Nor were modern methods of contraception mainly responsible. Most Americans still relied on the same contraceptive techniques at the end of the nineteenth century as at the beginning, namely abstinence, withdrawal, and abortion.
American birth rates continued falling from 1900 to 1940, with the largest decline during the 1920s. By World War II almost all American demographers assumed that fertility would keep falling as long as life expectancy kept rising and urbanization continued. The “baby boom” that began after World War II was therefore a complete surprise. Everyone expected more babies in the first years after the veterans came home, but instead of falling back to its prewar level the birth rate kept rising until 1957. Whereas women who reached childbearing age in the 1920s had had an average of just over two children, those who reached childbearing age in the 1950s averaged three.
Because the rise in American birth rates between 1946 and 1957 was completely unprecedented, most demographers assumed it was temporary. But few anticipated that fertility would fall as low as it did in the 1970s. If we keep having children at our present rate, American women born after 1955 will have an average of only 1.8 childrenâ€”the lowest average in American history. Casual observers often attribute this decline to the pill, but the decline began before the pill came on the market, and the pill does not seem to have been a major factor since then. Legalized abortions may have played a larger part, but since we don’t know how many abortions took place before legalization, it is hard to be sure. In any event, surveys strongly suggest that the main reason fertility has fallen is that couples want fewer children, though it is also true that they are having fewer children they don’t want. Few demographers have even tried to explain this change in preferred family size.
Richard Easterlin, an economist at the University of Pennsylvania, is the bestknown exception. He has been promoting economic explanations of changes in fertility for nearly twenty years. In Birth and fortune: The Impact of Numbers on Human Welfare he has tried to present his theories in simple, nonquantitative language. Easterlin claims that the birth rate depends partly on how “welloff” young adults feel. Young adults’ feelings of affluence depend, in turn, on how easy it is for them to attain the standard of living they enjoyed when they were growing up. The easier they find it to match their parents’ standard of living, the more children Easterlin thinks they will have. He calls this the “relative income” hypothesis.
Easterlin also claims that fluctuations in the birth rate have strong effects on the quality of young people’s lives a generation later. Americans born into what demographers call small “birth cohorts” can look forward to high starting salaries, favorable promotion prospects, and low rates of unemployment, because the demand for workers of their age will generally exceed the supply. Because of their economic advantages, Easterlin argues, members of small cohorts also marry young and have large numbers of children (the relative income hypothesis). In addition, he suggests that they have low rates of illegitimacy, divorce, crime, and suicide, and have a generally benign view of their society. Members of large birth cohorts, in contrast, have unfavorable economic prospects because the supply of workers their age usually exceeds demand. As a result, these unfortunates tend to marry later, have fewer children, divorce more often, kill themselves more often, commit more crimes, and so on. Social scientists often label such predictions “cohort size” hypotheses, but since this label is not very descriptive I will call them “crowding” hypotheses.
If the “relative income” and “crowding” hypotheses were both correct, they could conceivably interact to produce long-term cycles in which low birth rates in one generation led to high incomes among young adults and hence high birth rates in the next generation, which in turn led to low incomes among young adults and low birth rates in the third generation, ad infinitum. Easterlin claims that this has actually happened and that America is now completing the first such cycle, which ran from about 1940 to 1980. A new cycle of rising relative incomes, rising birth rates, and declining divorce, crime, and suicide should therefore begin soon, as the smaller cohorts born during the 1960s reach maturity. Because this theory is superficially plausible and purports to explain a wide range of otherwise puzzling phenomena, it has exerted considerable influence on scholars during the past decade. Since the publication of Birth and Fortune it has also been taken up by popular prophets like Sylvia Porter.
Unfortunately, Easterlin is better at inventing theories than at evaluating them. Birth and Fortune contains a number of charts, tables, and footnotes that seem to support his claims, but both the evidence he presents and the reasoning he adduces to link this evidence to his theories are full of problems.
Consider the “relative income” hypothesis. According to Easterlin, recent fluctuations in the birth rate derive from a pattern of individual behavior that has remained the same for decades, namely that couples with high incomes relative to those of their parents (i.e., high “relative incomes”) have more children than couples with low incomes relative to their parents’. Since couples raised during the Depression reached childbearing age in the affluent years after World War II, an unusually large proportion had high incomes relative to their parents’, and the birth rate rose. When couples raised during the affluent postwar years reached childbearing age in the 1960s, a smaller proportion were able to match their parents’ incomes, not because times were hard in the 1960s but because their parents had done so well in the 1940s and 1950s. As a result, birth rates fell. Those who reached childbearing age during the stagnant 1970s were even less likely to feel affluent compared to the standards they had absorbed in the 1950s and 1960s, so the birth rate fell even further.
While Easterlin is right in claiming that the birth rate has risen and fallen since 1940 in tandem with the proportion of young couples enjoying high incomes relative to their parents’, he offers no evidence whatever that couples with high incomes relative to the income of their parents actually have unusually large families, much less that this relationship is strong enough to account for the dramatic changes in fertility between 1940 and 1980. Instead, he claims that “the requisite income history data [for testing this claim] do not exist.” This assertion is grossly misleading. Much relevant data exists, and none of it supports Easterlin’s theory.
Sociologists have been studying the relationship between fathers’ and sons’ economic positions for half a century, and in recent years demographers have looked quite carefully at the relationship of economic mobility to fertility. Because it is hard to gather retrospective data on parental income, demographers have usually measured economic mobility by comparing a man’s current occupation to his father’s occupation. Such investigations always find the same thing. Men working in highly paid occupations have fewer children than men working in poorly paid occupations. This remains true even when one compares men whose fathers were both in the same occupation. 1 This is precisely the opposite of what Easterlin’s relative income hypothesis would lead one to expect. Of course, incomes vary a lot within occupations, and Easterlin may believe that if demographers measured relative income instead of relative occupational status the results would be different. But he does not make this argument. He simply brushes the issue aside with his sweeping claim that “the requisite income history data do not exist.”
In fact, recent surveys also provide direct evidence on the effects of relative income. Siblings raised together, for example, have roughly the same standard of living while they are growing up. Easterlin’s theory therefore predicts that if one sibling ends up with more income than another, the more affluent sibling should have more children. Three years ago two sociologists at the University of Wisconsin tried to test Easterlin’s theory by looking at the relationship of income differences between brothers to fertility differences. Their findings supported Easterlin in the limited sense that the more affluent of two brothers did tend to have more children than the less affluent. But a 25 percent income differential between two brothers was associated with an average fertility difference of only 1 percent.2
Since Easterlin’s calculations suggest that the average American couple’s relative income declined less than 25 percent between 1957 and 1977, the evidence on brothers implies that this decline in relative income should not have reduced fertility by more than I percent. Since the overall decline in fertility was at least 40 and perhaps more than 100 percent, depending on the measure one uses, the decline in relative income was not, on this evidence, an important explanation of the decline in fertility. It is true that this study of brothers covers only one city, Kalamazoo, Michigan, so Easterlin might argue that it is not representative of the nation as a whole. But he makes no such argument. Instead he claims that income data on individuals suitable for testing his theory does not exist at all.
Several other major surveys have measured relative income even more directly. The best records come from a long-term study of men who finished high school in Wisconsin in 1957. After taking elaborate precautions to ensure confidentiality the University of Wisconsin obtained access to these men’s Social Security records from 1957 through 1971 and to their parents’ state income tax returns for 1957 through 1960. Easterlin may not have known about these records’ existence. But they are among the richest and best-known sources of evidence on matters of this kind in all of social science, so even casual inquiries among demographers would have sufficed to reveal their existence. Are we to believe Easterlin made no such inquiries? If he didn’t how could he assert with such confidence that the data needed to test his theory did not exist? If he did, how could he have failed to discover this data?
The classic study is Peter Blau and Otis Dudley Duncan, The American Occupational Structure (Wiley, 1967), chap. 11.↩
Estimated from data presented by Michael Olneck and Barbara Wolfe in "A Note on Some Evidence on the Easterlin Hypothesis," Journal of Political Economy, October 1978.↩