The Pennsylvania Model of Fertility

The Importance of Relative Income In the Pennsylvania model, children are assumed to be a normal good in the sense that when couples feel wealthier, they will have more children. It is assumed that their expectations are formed during childhood and adolescence. If their income is greater than their expected income, they will have more children. If it is less than their expected income, they will have fewer children.

The Importance of Relative Income
In the Pennsylvania model, children are assumed to be a normal good in the sense that when couples feel wealthier, they will have more children. It is assumed that their expectations are formed during childhood and adolescence. If their income is greater than their expected income, they will have more children. If it is less than their expected income, they will have fewer children.

The Easterlin Model Easterlin assumed that the wages for entry level jobs varied inversely with the number of new entrants. (The births 20 years earlier). On the other hand, the number of births varied directly with the level of current income relative to already formed expectations.

The Easterlin Model
Easterlin assumed that the wages for entry level jobs varied inversely with the number of new entrants. (The births 20 years earlier). On the other hand, the number of births varied directly with the level of current income relative to already formed expectations.

The Parents of the Boomers The parents of the boomers were born about 1935 when wages were unexpectedly low due to the Great Depression. Because they were feeling relatively poor, young people had relatively few children during the Depression.

The Parents of the Boomers
The parents of the boomers were born about 1935 when wages were unexpectedly low due to the Great Depression. Because they were feeling relatively poor, young people had relatively few children during the Depression.

The Boomers The Boomers were a large cohort. When they entered the labor market, wages for entry level positions fell well below what they had come to expect living in the comfortable homes of their parents. Though their wages were higher than the entry level wages of their parents twenty years earlier, they felt poor relative to their expectations and responded by delaying marriage and chilbearing and thus producing a small generation, "Generation X".

The Boomers
The Boomers were a large cohort. When they entered the labor market, wages for entry level positions fell well below what they had come to expect living in the comfortable homes of their parents. Though their wages were higher than the entry level wages of their parents twenty years earlier, they felt poor relative to their expectations and responded by delaying marriage and chilbearing and thus producing a small generation, “Generation X”.

Generation X The children of the "Baby Boomers" are called "Generation X". They ae a relatively small generation. Thus they were able to command unexpectedly high wages when they entered the job market in the 1990s. It remains to be seen whether their fertility patterns will be more like their parents (the Baby Boom) or their grandparents (the Baby Bust).

Generation X
The children of the “Baby Boomers” are called “Generation X”. They ae a relatively small generation. Thus they were able to command unexpectedly high wages when they entered the job market in the 1990s. It remains to be seen whether their fertility patterns will be more like their parents (the Baby Boom) or their grandparents (the Baby Bust).

The Easterlin Cycle The graph on the right portrays the entire Easterlin cycle since the Great Depression.

The Easterlin Cycle
This graph portrays the entire Easterlin cycle since the Great Depression.

Easterlin Over Time This graph is a stylized representation of the time path of wages and births (in blue) and the time path of new entrants into the labor force (in red).

Easterlin Over Time
This graph is a stylized representation of the time path of wages and births (in blue) and the time path of new entrants into the labor force (in red).