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UNIVERSITY OF ECONOMICS INSTITUTE OF SOCIAL STUDIES HO CHI MINH CITY THE HAGUE VIETNAM THE NETHERLANDS VIETNAM – NETHERLANDS PROGRAM FOR M.A IN DEVELOPMENT ECONOMICS HOW DO WOMEN’S EDUCATION AND CAREER AFFECT THEIR DECISION ON MARRIAGE AND MOTHERHOOD? A CASE STUDY FOR VIETNAM BY TRUONG UYEN PHUONG Academic Supervisor Dr. TRUONG DANG THUY DECEMBER 15th, 2016 Page 1 ACKNOWLEDGEMENT The first thing I would like to express is my deepest gratitude to my academic supervisor Dr. Truong Dang Thuy. Thanks for your enthusiastic, patient and dedicated support for guiding me to implement this thesis and overcome many difficulties during the entire process. Once again, I am really appreciated your valuable encouragement. I would like to give my appreciation to all lecturers in Vietnam – Netherlands Program, who have provided me such useful knowledge that I can applied to this thesis as well as in my future’s job. I am grateful to all staffs of Vietnam – Netherlands Program and all of my friends for your help. I deeply treasure all the moments we have and share with each other. Yet I have still had a lot of mistakes, I really expect all teachers to give sincere remarks to me to be better. And the last one is our best wishes to all of you. Page 2 ABSTRACT Nowadays, time to marry has been earlier among women in developing countries, and time of entry into first marriage has each particular effect on health issue of women and their children. However, there are not many researches focusing on this area, especially for the case of Southeast Asia countries. Therefore, this paper is designated for filling this gap, and I choose the case of Vietnam for analysis to investigate the association between social factors such as education, ethnic, religion, and income and on women’s first marriage and childbirth decisions. The dataset is established from a random online survey with 505 respondents including men and women, but the purpose of this paper is not suitable for men, then male’s respondents are automatically excluded from the dataset. Consequently, my sample consists of 304 women aged 18 to 66, which is divided into birth cohort in order to find whether there is any difference in marriage or rearing children among generations. Survival model analysis is applied to give the probability of getting marriage at a specific time of women’s life. The study found that educational level, income, time of first intercourse, promotion achievement have significant impacts on women’s marriage decision and fertility. Page 3 CONTENTS CHAPTER 1: INTRODUCTION 1.1. RESEARCH PROBLEM ................................................................................................................ 7 1.2. RESEARCH OBJECTIVES ........................................................................................................... 9 CHAPTER 2: LITERATURE REVIEW 2.1. THEORETICAL LITERATURE ................................................................................................ 11 2.1.1. Theory of Marriage & The division of Labor ............................................................................ 11 2.1.2. Theory of Marriage Market........................................................................................................ 16 2.1.3. Theory of Fertility ...................................................................................................................... 18 2.2. REVIEW OF EMPIRICAL STUDIES ........................................................................................ 21 CHAPTER 3: DATA AND METHODOLOGY 3.1. DATA .............................................................................................................................................. 25 3.2. METHODOLOGY......................................................................................................................... 25 3.3. VARIABLES’S DEFINITION...................................................................................................... 27 CHAPTER 4: EMPIRICAL RESULT 4.1. EMPIRICAL RESULT ................................................................................................................. 40 4.1.1.Statistics ...................................................................................................................................... 40 4.2. RESULTS ....................................................................................................................................... 71 4.2.1.Result for First-Marriage ............................................................................................................ 71 4.2.2.Result for First-Birth ................................................................................................................... 74 CHAPTER 5: CONCLUSION 5.1. MAIN FINDINGS & RECOMMENDATION ............................................................................ 78 5.2. LIMITATION AND FURTHER STUDIES ................................................................................ 80 REFERENCE ........................................................................................................................................ 82 APPENDIX ............................................................................................................................................ 84 Page 4 LIST OF TABLES Table 3.1. First-Marriage Variables Description (Education and Career Variables) Table 3.2. First-Marriage Variables Description (Social Background Variables) Table 3.3. First-Birth Variables Description (Education and Career Variables) Table 3.4. First-Birth Variables Description (Social Background Variables) Table 3.5. First-Birth Variables Description (Social Background Variables) Table 4.1. Summary statistics of First marriage Table 4.2. Summary statistics of Women’s educational level at first marriage Table 4.3. Summary statistics of Women’s promotion achievement at first marriage Table 4.4. Summary statistics of Job movement at first marriage Table 4.5. Summary statistics of Job at first marriage Table 4.6. Summary statistics of Birth cohort Table 4.7. Summary statistics of Residence at first marriage and first birth Table 4.8. Summary statistics of being a chief income earner at first marriage Table 4.9. Summary statistics of acestor worship at first marriage and first birth Table 4.10. Summary statistics of Religion at first marriage and first birth Table 4.11. Summary statistics of Birth order at first marriage and first birth Table 4.12. Summary statistics of Father’s education at first marriage and first birth Table 4.13. Summary statistics of Mother’s education at first marriage and first birth Table 4.14. Summary statistics of Father’s job at first marriage and first birth Table 4.15. Summary statistics of Mother’s job at first marriage and first birth Table 4.16. Summary statistics of First birth Table 4.17. Summary statistics of Educational level at first birth Table 4.18. Summary statistics of Promotion achievement at First birth Table 4.19. Summary statistics of Job movement at First birth Table 4.20. Summary statistics of Job at First birth Table 4.21. Summary statistics of Living arrangement at First birth Table 4.22. Summary statistics of Housework regularity at First birth Table 4.23. Summary statistics of Abortion at First birth Table 4.24. Summary statistics of Contraceptive knowledge at First birth Table 4.25. Summary statistics of Age at First intercourse Page 5 Table 4.26. Summary statistics of Contraceptive type at First birth Table 4.27. Summary statistics of Women’s wealth at first marriage and first birth Table 4.28. Results for First marriage by Exponential and Cox regression Model Table 4.29. Results for First birth by Exponential and Cox regression Model (Educational and Career opportunities variables) Table 4.30. Results for First marriage by Exponential and Cox regression Model (Social background variables) Graph 1. Probability of remaining single by women’s age Graph 2. Probability of remaining single by women’s birth cohort Graph 3. Probability of remaining single by women’s educational level Graph 4. Probability of remaining single by women’s job Graph 5. Probability of remaining single by women’s promotion achievement Graph 6. Probability of remaining single by women’s job movement Graph 7. Probability of not having first child by Age Graph 8. Probability of not having first child by birth cohort Graph 9. Probability of not having first child by women’s education Graph 10. Probability of not having first child by women’s job Graph 11. Probability of not having first child by women’s promotion achievement Graph 12. Probability of not having first child by women’s job movement Graph 13. Probability of marriage by educational level Graph 14. Probability of marriage by promotion achievement Graph 15. Probability of marriage by Job movement Graph 16. Probability of marriage by Job Graph 17. Probability of fertility by educational level Graph 18. Probability of fertility by promotion achievement Graph 19. Probability of fertility by job movement Graph 20. Probability of fertility by Job Page 6 Chapter 1 Introduction 1.1. RESEARCH PROBLEM In recent years, economists have frequently used economic theory to explain the behavior outside economic sector, for example, crime, education, politics, corruption, fertility and so on. Yet, one type of behavior has been paid less attention is the behavior of marriage. Nowadays, young women are more different than the previous generation since they are able to profit from education. The occupational structure of the labor force is being transformed, and the number of women pursuing higher education has risen, then the relationship between women’s economic independence (resulting from higher education and job offering) and age of first marriage has been one of the central topics among demographers. According to many researchers for example Elder, 1972; Waite & Spitze, 1981, the traditional path of determining age at first marriage among women is through an array of variables, such as ethnicity, place of birth, birth order, number of siblings, women’s parents’ social class. Over a long period of time, the scope of this area has been realized and the concentration of some papers relating to this field has transferred from a mere determinant to the effects of educational and career achievement on the time of entry into first marriage. (Bloom, 1990; Blossfeld and Huinink, 1991, Oppenheimer, 1997). This trend in research analysis is properly comprehensible with visible evidence of postwar era in numerous countries. The more investment in education and opportunities for employment has induced women to look for work in labor market, which leads to releasing from financial support of their husbands and great success in career. Moreover, marriage age has increased significantly in many developed countries around the world. According to U.S. Census Bureau, 2010, the median marriage age for women and men in 1950-1960 Page 7 was 20 and 23 respectively; it increased to 27 and 29 in 2013. The situation is more serious for the case of Germany, Netherlands, Denmark, United Kingdom, South Korea, Taiwan and many other countries with the range from 29 to 32. A great number of studies had been done for Western Germany, for instance, the paper of Diekmann (1990) found that the expansion of education has move the median age of marry upward almost one year. Although various researches have been conducted to identify the main factors of this trend among advanced countries, (e.g Blossfeld & Huinink, 1991; Cherlin, 1980; Diekmann, 1989; Elder & Rockwell, 1976; Hoem, 1985; Hoem & Hoem, 1987; Hogan, 1978; Huinink, 1987; Marini, 1985), very few studies are undertaken for less developed countries. Finally, marriage and fertility are connected processes, assuming that fertility often takes place within marriage and contraceptive practices are non-existent, there is an inverse relationship between time at first marriage and fertility. Specially, in a Southeast Asian country like Vietnam, where traditional value is highly evaluated, woman must be married before having her first baby. As educational level affects family formation, it also has direct impact on pregnancy decision. Women’s increased control over fertility, a better chance to access to higher education, and a fall in discrimination will offer women a stable income, Goldin and Katz (2002), Blau and Kahn (1997, 2000), so they tend to earn more and more to prepare for children’s life. In Viet Nam, the age of first marriage of women is 22.8 years of age. This figure did not change in the last one and a half decade (source), while that of men increased from 25.2 to 26.2 from 1999 to 2009. Age of first marriage of Vietnamese women is comparable to Southeast Asian countries, for example Cambodia Thailand 21, Malaysia 25.7, Indonesia 22.3, but quite low comparing to that of developed countries, for example Canada 29.1, UK 30 and the Netherlands 30.4. Women in these developed countries obviously have higher education and career opportunities compared to Vietnamese women. One question arises is that whether Vietnamese women delay their optimal time for first marriage and birth change when having more education and career opportunities. And what is the association Page 8 between education and delayed first marriage and childbirth? The answers to this question is quite important for a range of policies, including family planning, schooling and education services, and the planning of health care and child care services. This paper is also to find out the answer for the questions and help to diminish the anxiety and distress women have to encounter when their time of first children is delayed more than they or society expects. 1.2. RESEARCH OBJECTIVES This study focuses on the question of how the improvement in women’s education affects their marriage behavior and child-bearing decision, which is built on the “New home economics” theory. A highly positive relation between years of schooling and marriage age is broadly accept; in other words, higher educational level is a causal factor for marriage postponing. We will take into account some hypothesis such as “independence hypothesis”, “specialization hypothesis”, “human capital effect”, “institution effect” in order to answer the basic question is whether higher education level delays marriage or if it also reduces marriage intensity. In order to answer this question, I use the technique of “Survival analysis” to examine how the probability of entry into first marriage and motherhood changes over ages. Particularly in this study, the application of survival analysis will help investigating how education and career change the rate of women entering first marriage and motherhood. This is to provide information on the potential benefits of policies that improve women education and career opportunities. In this paper, I intend to conduct an online survey for collecting data since there are no available sources on the needed information for this estimation, particularly the data on age at first marriage or first birth of women. Based on economic theory on marriage or childbearing and previous empirical study, I identified several variables, including age-independence, social class, level of education, and participation in the educational system and cohort membership in the analyses. These variables are asked directly in the questionnaire and expected respondents are women aged from 18 or higher. Page 9 This study is designed into 5 main parts to theoretically and empirically analyze how women education or career development as well as social background affect to their decision on marriage and childrearing Chapter 2 postulates the social framework of theory that this paper is relied on. Particularly, the most noticeable theory is the “New home economics” of Gary Becker (1981), which shed light on the determinants of marriage and demand for children. Chapter 3 represents the pattern through which data on women is collected and variables definition as well as model estimation to contribute a reliable implication on this area. Chapter 4 provides comprehensive results for the relationship that we have supposed from the beginning until this part. It is expected to be consistent with the available theory. Chapter 5 gives a final conclusion based on the transparent results in part 4, from this perception; this paper will commit its limitation and infer some further studies. Page 10 Chapter 2 Literature Review 2.1. THEORETICAL LITERATURE This chapter first presents the theoretical literature about the decision of entry to marriage and motherhood, particularly focusing on the impacts on education and career opportunity. This chapter also reviews empirical studies on these issues. These theoretical and empirical reviews serve as the basis for the analytical framework presented in Chapter 3. 2.1.1. Theory of Marriage & The division of Labor In this section, I present the determinants of the benefits of marriage compared to single life for one man and one woman. This will be the basis for analyzing the optimal timing of marriage. Consider two persons, a male (M) and a female (F) to observe whether they should marry each other or stay alone. “Marriage” is assumed to be the action of M and F share the same household and according to Gary Becker (1981), the incentive for both men and women to marry is the gaining of marriage life; in the aspect of economics, they can increase their utility after getting marriage. Utility depends not only on the purchased goods and services in market place, but also on the commodities produced by each household. These commodities include the quality of food, the quality and quantity of children, reputation, entertainment, friendship, love and health status. Importantly, these goods are not marketable or transferable between households, but only among members in the same household. Consequently, they cannot be measured as a usual manner of other output, but we assume a single aggregate (Z) is a combination of all these commodities. Maximizing utility thus becomes equal and similar for each person to maximize the amount of Z that he or she receives. The production function of each household which connects its total output of Z to different inputs is displayed below: Page 11 Z = f (𝑥1,…. , 𝑥𝑚 ; 𝑡1 , … . , 𝑡𝑘 ; 𝐸) (1) In which 𝑥𝑖 are various market goods and services, 𝑡𝑗 is time inputs of different household members, and E are “environmental” variables. The budget constrain for the 𝑥𝑖. can be written as: ∑𝑚 𝑝𝑖 𝑥𝑖 = ∑𝑘 𝑤𝑗 𝑙𝑗 + 𝑣 (2) Where 𝑤𝑗 the wage rate of the jth member is, 𝑙𝑗 represents how much time a man spends on working in the market sector, and v is the property income. 𝑙𝑗 and 𝑡𝑗 are related by the basic time constraint: 𝑙𝑗 + 𝑡𝑗 = T (3) Where the total time of each member is denoted by T, substituting (3) into (2), a single full income constraint can be constructed by the combination of the goods and time constraints as (4) ∑𝑚 𝑝𝑖 𝑥𝑖 + ∑𝑘 𝑤𝑗 𝑡𝑗 = ∑𝑘 𝑤𝑗 𝑇 + 𝑣 = 𝑆 (4) In which if the 𝑤𝑗 is unchanged, full income is appreviated by S – the maximum achievable income, there is an assumption that a decrease in household’s total output (Z) cannot make any members better off but some worse off. Hence, to maximize the total output Z, each member would not hesitate to contribute his time and goods to this allocation. And necessary conditions to maximize Z include: 𝜕𝑍 ) 𝜕𝑡𝑖 𝜕𝑍 𝑀𝑃𝑡𝑗 ≡( ) 𝜕𝑡𝑗 𝑀𝑃𝑡𝑖 ≡( 𝑤 = 𝑤 𝑖 For all 0 < t < T 𝑗 (5) If T is the household time of the 𝑘𝑡ℎ member, then 𝑀𝑃𝑡𝑘 𝑀𝑃𝑡𝑗 𝜇 = 𝑤𝑘 𝑗 (6) Where 𝜇𝑘 ≥ 𝑤𝑘 is the “shadow” price of the time of k. Also 𝑀𝑃𝑥𝑖 = 𝑝𝑖 𝑀𝑃𝑡𝑗 𝑤𝑗 for all 𝑥𝑖 > 0 𝑎𝑛𝑑 0 < 𝑡𝑗 < 𝑇 (7) Thus, there must be an appropriate allocation and cooperation in time between the market and nonmarket sectors among each member. If a man and a woman are married, their household is assumed Page 12 to contain only the two time inputs of them; in other words, we have ignored the time of children and other people living in the same household. From the equation (5) and (7), we can infer that female would specialize in nonmarket sector if 𝑤𝑚 /𝑤𝑓 or 𝑀𝑃𝑡𝑓 /𝑀𝑃𝑡𝑚 are sufficiently large. Similarly, a single household allocates only his or her time between the nonmarket and market sectors to satisfy equation (7). Specifically, single woman is more likely to work more than married woman because they do not have time and goods supplied by the others partner. If 𝑍𝑚0 𝑎𝑛𝑑 𝑍0𝑓 represent the maximum outputs of single man and woman, and 𝑚𝑚𝑓 𝑎𝑛𝑑 𝑓𝑚𝑓 are their married incomes, a necessary condition for a man and a woman to marry is that the income after married is higher than that if they remain single: 𝑚𝑚𝑓 ≥ 𝑍𝑚0 𝑓𝑚𝑓 ≥ 𝑍0𝑓 (8) If 𝑚𝑚𝑓 +𝑓𝑚𝑓 , the total income achieved by the marriage, is identified with the output of the marriage, a necessary condition for marriage is as below: 𝑚𝑚𝑓 + 𝑓𝑚𝑓 ≡ 𝑍𝑚𝑓 ≥ 𝑍𝑚0 + 𝑍0𝑓 (9) The presence of children is considered as the most reasonable reason for marriage between men and women. Children are the only subjects distinguishing single households from married households because sexual demand, care for food and drink, washing and cleaning and many other things can be served by money power, except own children. The strong emotion between the two individuals, called “Love” is also a unique contribution to the purpose of marriage. Page 13 Cost of marriage, income and the timing of marriage Another important point is that the gain from marriage is also determined by market opportunities or whether a rise in income encourages men and women to get marriage. The expenses of getting married increases to the extent that the own time of man and woman enters into search and other marital costs. Many couples can minimize the cost of regular communication and of transfering resource between each other by sharing the same household or living together. As a result, this analysis anticipates that acceleration in property income, and a higher level of wage rates, probably enhances the incentive to marry. This implication proves a fact that poor people may marry earlier than rich persons but is compatible with the empirical evidence. Likewise, this analysis shows that a rise in female’s wage relative to male’s wage, holding the time in household sector constant, would reduce the return from marriage if women’s wage is lower than men’s wage. Since single women work more than married women and single men work less than married men, a growth in wage rate of women comparing to men may reduce the incentive to marry.(Santos, 1970; Freiden 1972). The traditional family model induces a comparative advantage of women over men in a family because women invest mainly on human capital that raises household efficiency while men are expected to be expert in labor market. Hence, “new home economics” suggests a gender-specific pattern of labor in our society and mutual dependence between sexes are major incentives to marry. According to this mechanism, the decline in specialization of women due to the increase in economic status (directly resulted by educational expansion) has caused important consequences for marriage. First, it can be explained that a successful woman in her career will be a less attractive partner because she cannot focus on her main duty of home production. Second, women derive less profit from marriage if they have less need on husband’s income; as a result, economic independence enables women to opt out of marriage since they can afford themselves financial freedom. Benard (1972) or Raymo and Iwasawa (2006) proved that high-status women may play an important role in reducing marriage rates. Page 14 Education and the timing of marriage “Specialization hypothesis” shows the impacts of education and training on marriage through two causal paths “human capital effect” and “institution effect”. “The institution effect” refers the longer the time an individual stays at school, the lower the possibility for marriage because of three main assumptions proposed by Thornton (1995). Students are not matured enough for adult role, students do not have time for other roles except studying, and married people should be independent in financial aspects. Thus, spousal role and studying duty of students are inappropriate. Under the division of labor, women tend to leave school when they married since they have to spend most of their time for family. As a result, future income of women is also lessened because they have sacrificed their investment in human capital for household work. On the one hand, “human capital effect” has an essential impact on not only marriage, but also fertility and marriage stability at the end of training or education level. Despite a higher possibility of stable income in the future, investment on education creates higher opportunity costs for women. Therefore, it is expected that educated women decrease the tendency to marry. Moreover, women with financial independence will not gain much from marriage, and thus more of them will not marry at all. If both effects operate, we can find out the combination of them. “Institution effect” increases the age at marriage, and the “human capital effect” also raises the timing into marriage. As a result, we expect a negative effect for both of them, since they move in the same direction. Thirdly, we should consider the channels through which a woman may never get marriage, and investigate how the above theory works in this case. “Institution effect” alone cannot let women postpone their marriage forever, and then they will marry as the others lower-educated women do. This should not have any special impacts on the proportion of never marry since there is not limit for the age of marriage, while fertility is limited at a specific age. However, there is a debate as women are older, they will be hard to find a potential partners since these partners are all already married, at this time, “institution effect” seems to be effective. This argument may be not enough to persuade, as there are a Page 15 lot of men who are staying at school, delayed marriage, too. Therefore, we predict that institution effect will not appear in the proportion of never marriage. On the other hand, a negative human capital effect shows a strong correlation since highly-educated people are least profited from family formation, so most of them will not marry at all. 2.1.2. Theory of Marriage Market The second conceptual framework I would like to mention is the Assortive mating in marriage markets. Because of imperfect information, the process of finding best mates among men and women can be very costly. When finding a good match, people tend to set up a minimum level of acceptance, not trying to find a perfect one. Those whose conditions are lower than this limit of acceptability will generally not be taken into account. However, there is a problem of detecting whether the searching for a mate occurs or not, young people accidentally start to date when they were in their teens, this time is usually much earlier than the time we assume they are looking for marital partners. Specifically, searching for another half of one’s life is often going along with other activities – working, school, entertainment activities and etc. A person may not look for a spouse but still find one. Given this complication in searching for marital partners’ behavior, the most appropriate strategy may not focus on whether there is an actual search, but to find out what conditions enables or induce successful searches. Assortative mating Assortative mating in humans occurs based on a broad array of traits, including social economic, characteristic, educational, residential, traditional, religious, and so on. In reality, there are many evidences for assortative mating regarding to altruism. Many people in love reveals their similarities in terms of their contributions to public improvement and charities, and generosity can be considered as a proxy for mate choice instead of phenotypic convergence. (A. Tognetti, 2014). Another evidence comes from the finding of Greenwood et al. (2015), which concludes couples also sort for appropriate mate by educational levels and this trend tends to go upward overtime. Moreover, assortative mating by Page 16 genomic similarities shows its significance in human marriages in the United States. In fact, spouses are more genetically identical than two randomly chosen individuals. Equilibrium conditions for Assortative Mating with Monogamy Identical men receive the same income in an efficient marriage market regardless of whom they marry or whether they choose to remain single. Since marriage with superior women produce larger outputs, superior women receive higher incomes in efficient markets. The difference between the incomes of the jth woman and the 𝑖𝑡ℎ woman would be: 𝑓 𝑓 𝑍𝑗 -𝑍𝑖 = (𝑍𝑚𝑗 − 𝑍 𝑚 ) − (𝑍𝑚𝑖 − 𝑍 𝑚 ) = 𝑍𝑚𝑗 − 𝑍𝑚𝑖 𝑓 Where 𝑍𝑘 is the equilibrium income of the 𝑘𝑡ℎ woman, 𝑍 𝑚 is the equilibrium income of men, and 𝑍𝑚𝑘 is the marital output of the 𝑘𝑡ℎ woman and any man. Superior women receive a premium that is determined by their additional productivity as wives. If each person is a utility maximizer and chooses the mate who maximizes his utility, the optimal sorting must have the attribute that people not married to each other could not marry without making at least one of them worse off. Utility is monotonically related to commodity income; therefore a noncore marriage cannot produce more than the sum of the incomes that its two mates would receive in the core. If it could produce more and if any division of output were feasible, a division could be found that would make each better off, thereby contradicting the optimality of the core. The mating of likes or unlike is optimal as attributes are complements or substitutes, because superior people strengthen and support each other when traits are complements and compensate each other when traits are substitutes. This theorem also implies that the benefit a woman can obtain from marriage of a given quality is greater for an exceptional man when traits are complements, and is better for an inferior man when traits are substitutes. Positive assortative mating frequently occurs in an efficient marriage market, where superior men are compatible with high-quality women, and inferior men are matched with low-quality women. Page 17 However, negative assortative mating is sometimes important. Maximizing the aggregate output of household commodities is also a feature of an efficient marriage market, where no one can raise the value of his marriage without making others worse off. The return from marriage also correlates with appearance, education, brilliance and other traits that have impacts on non-market productivity as well as market opportunities. Holding the market productivity unchanged, the analysis of mate sorting refers acceleration in the value of traits that affect to nonmarket productivity, would cause a higher demand in marriage. That’s the reason why less brilliant or less appealing people are going to have a longer time to marriage than those who are more enchanting and intelligent. The analysis of positive mate sorting proves the fact that the time of seeking for a suitable match will be extended as educational level increase. Women with high-educated level tend to find a man that has similar or even higher educational level than them. The case will be more serious if a particular woman has all those traits, like good-looking, intelligent, or well-educated. From the above theory, I expect a negative relationship between women’s expansion level of education and rate of entry into first marriage. 2.1.3. Theory of Fertility Similarly to the mechanism of marriage, women’s fertility is also determined by social factors. According to many researchers, the most suitable time for women to have their first child is when they can achieve best result from their plan, including human capital investment and labor market career. While man with a bright future plan for career and financial support to his family seems not having any impacts on his wife’s decision of having a child. Postpone of demand for children can be explained in the following economic framework (i) women have to scarify their time for taking care of their child instead of being in the labor market. Moreover, investing in human capital which results in higher wage is limited since they have no time for further education. These considered as opportunity cost, and women will consider opportunity costs between becoming a mother and investing in their educational level or establish her on labor market. Becker (1993) found cost of mother’s time is the most influential Page 18 factor to the total cost of children. (ii) As soon as a particular woman has her baby, she must leave her current job for a period of time to look after her son or daughter, this means the accumulated experience will remain or even decrease and her skill for this job will also be affected negatively. Then, most of them often choose to delay their major responsibility of being a mother. Next, Mills et al. (2011) drew a conclusion on negative effect between education and fertility and this idea can be supported by three main literature mechanisms. Firstly, the longer women stay in school, the longer the timing of first marriage and first child, this is considered as the responsibility of delay in first child (Blossfeld and Huinink, 1991). Secondly, women who invest more in human capital will have higher probability of achieving success in their career, as a result, the opportunity cost of marriage and giving birth also increases leading to lower fertility. (Becker 1991; Blossfeld and Huinink, 1991). Thirdly, more educated women practice the individualism on their career and life more than less educated one, so this discourages family formation and childbearing. (Lesthaeghe and Meekers 1987; Liefbroer 2005; Mills et al., 2011). As we have discussed above, Children are usually not purchased but are the products of marriage between two people from opposite sex; though this process requires a huge sacrify in time of the mothers. Each family has their own cost of consumption or different income, the cost of producing and bearing children cannot be the same. Assume 𝑃𝑛 denotes this cost and the cost of Z by πz, the budget constraint of a family equals: 𝑃𝑛 n + 𝜋𝑧 𝑍 = 𝐼 Where I is full income, given 𝑃𝑛 , 𝜋𝑧 and I, the the budget constraint and the marginal utility condition are employed to determine optimal quantities of n and Z: 𝜕𝑈 𝜕𝑛⁄ =𝑀𝑈𝑛 𝜕𝑈 𝑀𝑈𝑧 = 𝑃𝑛 𝜋𝑧 𝜕𝑍 The relative price of children and full income are two main determinants of demand for children, thus, Page 19 an increase in the relative price of children, in 𝑃𝑛 relative to 𝜋𝑧 , will lower the demand for children and boost the demand for other commodities (where real income is held constant). The relative price of children is affected by many variables, some unique to children, and several of the more important are now considered. The evidence over hundreds of years indicates that farm families have been larger than urban families. Part of the explanation is that food and housing, important inputs in the rearing of children, have been cheaper on farms. If children can help in household chores, family business or marketplace, then the net cost of children will be reduced. Thus, along with the potential gain from children, the incentive for having children also increases. In fact, farm families tend to have more children because children are considered more productive for farming than in the cities. The contribution of farm children has declined as agriculture has become more mechanized and complex in the course of economic development. Both of these elements have motivated farm families to extend their children's schooling. Because rural schools are often too small to be efficient; and it may take too much time and money for farm children to attend school. The cost advantage of rearing children on farms has narrowed, as farm children have spent more time at school. Consequently, nowadays, the fertility differentials between urban and rural area have been narrowed in developed countries; while rural fertility is sometimes less than urban area in some countries. Furthermore, the better opportunities of women in labor market or the increase in the value of time of married women has a significant impact on the relative cost of children. The higher income a woman can obtain, the higher opportunities cost of rearing and producing children because cost of mother’s time is the dominant cost of children. Indeed, over the last few decades, the steadily increase in earning power of women has become the main explanation for both the large proportion of married women in labor force participation and the major decrease in fertility. Since fathers have spent relatively little time on children, the growth in their earning power has no significant impacts on the cost of children and in fact would have reduced the relative cost if children used relatively less time of fathers than Page 20
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