A subjective equilibrium approach to the value of children in the agricultural household
Yotopoulos, P.A.; Kuroda, Y.
Pakistan Development Review 27(3): 229-276
1988
ISSN/ISBN: 0030-9729 PMID: 12315706 DOI: 10.2307/41259047Document Number: 360992
Data on a sample of agricultural households in the Philippines are used to explain production and consumption patterns as well as households' demographic structure (age-sex composition; education; etc.). A utility maximization model is used to study different household groups. The utility maximization hypothesis was explicitly tested and could not be rejected for any of the socioeconomic groups distinguished. The criterion of static efficiency, in the sense of rationality, was thus satisfied in all groups. The production analysis revealed that the major difference in the groups distinguished (owner or tenant farms and large or small size operations) was in the input of child labour. The coexistence of low marginal contributions of children with low fertility control in tenant or small farms is explained in terms of the inverse fertility-endowments hypothesis. Examination of the consumption side of the utility maximization model yields results that are consistent with the higher valuation of children (and thus higher fertility) in tenant and small-size households, as compared to owner and large-size households.