by Peter Jacobsen
The population bust has made its way into popular discussion about the looming issues we face as a country and a world. After centuries with a growing population, humanity is finally projected to begin to shrink by the end of this century.
The realization of the downsides of fewer brains has dawned on many, including Elon Musk, who views it as a major problem:
Population collapse is a major risk to the future of civilization https://t.co/ZI8QRt2Ev4
— Elon Musk (@elonmusk) January 24, 2023
In this vein, some have begun to seek answers on how to turn the situation around. The cause of the problem is difficult to diagnose. The rising opportunity cost of children for women, cheap access to birth control, and cultural and institutional changes are all brought up as major contributors.
While it’s safe to say that the situation is too complex to provide a one-size-fits-all diagnosis and cure, a new working paper out of George Mason University sheds some light on the issue.
Authors Anna Claire Flowers, Vincent Geloso, Clara Piano, and Lyman Stone argue that regulations are part of the story.
To understand their paper, you first need to understand that, at least in the US, women have fewer children than they say they want to have. When women are surveyed about how many children they want, researchers consistently find that the number of children they actually have falls short. This is known as the fertility gap.
In a summary of the paper for the Institute for Family Studies, Anna Claire Flowers explains that the fertility gap ranges from 0.3 to 1.3 across states. To be clear, a fertility gap of 0.3 means that women on average want 0.3 more children than they have. Or, put another way, in a group of 10 women, they are on average 3 children short of their combined goal. So a gap of 1.0 would indicate that, on average, all women surveyed have 1 less child than they want.
Again, these are averages, so it isn’t the case that every woman wants more children; but women dowant more on average, to varying degrees across the US.
Here’s where the paper gets interesting. The authors compare the fertility gap across the US to the childcare regulations that exist in different places.
What is a childcare regulation? Some states require care facilities to have certain children-to-staff ratios or educational attainments on the part of their staff. The authors give the example: “[Washington, DC,] requires all early childhood educators to have an associate’s degree or higher in early childhood education or a closely related field, regardless of experience level.”
Different states have varying levels of regulation with respect to childcare. Regulations on childcare may be well intentioned, but they result in higher costs for parents.
If someone is required to have a degree to work in a daycare, the daycare must compete with the higher-paying jobs she qualifies for by virtue of her degree, and it can only do that by offering more pay. But money does not grow on trees. The only way daycares can pay more is if they charge their customers more. In other words, competition for these higher-skilled workers results in higher prices for customers—whether policy-makers want higher prices or not.
The results are exactly what you’d expect. According to the authors:
Our results consistently show fewer childcare regulations are associated with smaller fertility gaps. This suggests that women are better able to achieve their fertility goals in policy environments that allow for more flexibility in childcare options and lower costs.
In other words, states with more childcare regulations tend to have larger fertility gaps—women are less able to have as many children as they’d like. The fascinating implication, of course, is that reducing or eliminating childcare regulations could help facilitate higher birth rates.
One of the persistent drawbacks associated with pronatal policies is that they tend to be high-cost. But the implication of this new paper is that they need not be. By allowing parents to regulate childcare with their purchasing decisions, rather than relying on politician-assigned standards, it seems possible to lower the cost of childcare and, as a result, support parents in having larger families.
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Peter Jacobsen is a Writing Fellow at the Foundation for Economic Education.
Photo “Family Photo” by Emma Bauso.
