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ABSTRACT
In many developing countries, children are viewed as a source of old-age insurance. They help parents to smooth consumption by sending remittances when the parents are old and have relatively low income. The paper presents a model where asset accumulation and children are substitutes. Using a family planning programme as an instrument for fertility it shows that households exposed to the programme have (0.86) lower fertility and $994 worth of more assets than those who were not exposed to the programme.
KEYWORDS:
Acknowledgments
I am grateful to Abhijit Banerjee and Esther Duflo for their valuable guidance and suggestions in conducting this research. Zaki Wahaz, and my colleagues provided important feedback and comments. The paper uses data collected and shared by the International Centre for Diarrhea Disease Research, Bangladesh, which was funded by the National Institute for Aging. Dr. Nurul Alam and Mr. Sajal Kumar Saha from ICDDR,B provided invaluable support in collecting and using the 1974 Census data.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Notes
1. Some other similar cross section studies are National Academy of Science (Citation1972), Nugent (Citation1985), Foster and Rosenzweig (Citation2001) etc.
2. Please see the Appendix for details.
3. The conversion used the exchange rate reported in the Treasury Reporting Rates of Exchange as of 31 March 1996 by the Department of the Treasury Financial Management Service.
4. The per capita health expenditure in Bangladesh was USD 11 in 1996, and 36% of it was public expenditure (World Bank, Citation1996). Therefore, each individual spent about USD 7 out of pocket on healthcare. It should be noted that in a rural area of Bangladesh like Matlab, usually when women are sick, they don’t seek medical attention if it is not something serious (Koenig et al. Citation2007). Therefore, the differences in asset could not be the result of accumulated health shocks in the control areas.