Frühwirth-Schnatter, Sylvia Halla, Martin Posekany, Alexandra Pruckner, Gerald J. Schober, Thomas
Year of Publication:
NRN Working Paper, NRN: The Austrian Center for Labor Economics and the Analysis of the Welfare State 1402 Working Paper, CD-Lab Aging, Health and the Labor Market, Johannes Kepler University 1501
Prior empirical research on the theoretically proposed interaction between the quantity and the quality of children builds on exogenous variation in family size due to twin births and focuses on human capital outcomes. The typical finding can be described as a statistically nonsignificant two-stage least squares (2SLS) esti- mate, with substantial standard errors. We regard these conclusions of no empirical support for the quantity-quality trade-off as premature and, therefore, extend the empirical approach in two ways. First, we add health as an additional outcome di- mension. Second, we apply a semi-parametric Bayesian IV approach for econometric inference. Our estimation results substantiate the finding of a zero effect: we provide estimates with an increased precision by a factor of approximately twenty-three, for a broader set of outcomes.
Quantity-quality model of fertility family size human capital health semi-parametric Bayesian IV approach