Early life experiences and adult fertility

While a substantial literature examines demographic transition, surprisingly few papers examine changes in desired fertility levels and the subsequent changes in fertility outcomes in developing countries. Since early life experiences are linked to permanent changes in behavior along a range of dimensions (risk aversion, trust, preferences), the study examines whether fertility outcomes of mothers in Indonesia (i.e. stillbirths, miscarriages, infant deaths) have a lasting influence on the fertility outcomes of their daughters. Doing so requires a host of information pertaining to the childhood of the daughter which is typically missing from the cross sectional set up. Most studies of fertility choice rely heavily on cross sectional data at the community and the individual levels thereby ignoring the household characteristics. Even though the twin studies are an attempt to overcome such shortcomings, twin birth occurrence is a rare phenomenon and might not be an accurate representation of the household’s time and resource allocation in the case of a normal birth. We overcome such obstacles by using the four existing rounds (1993, 1997, 2000, and 2007) of the Indonesia Family Life Survey (IFLS)  which allows us to control for mother fixed effects and to identify time varying exposure to these events having lasting effects. Preliminary estimates suggest a strong effect, particularly at the age where children are old enough to understand the experience. We find suggestive evidence that individuals respond differently to children dying young. We show that individuals who experience a sibling death at an age in which they are old enough to realize the gravity of such events change their own perception of fertility, thus, strengthening the argument that childhood experiences having a long term impact.