The "Low Fertility Trap" Hypothesis

Wolfgang Lutz, International Institute for Applied Systems Analysis (IIASA)
Maria Rita Testa, Vienna Institute of Demography
Vegard Skirbekk, International Institute for Applied Systems Analysis (IIASA)

This paper concerns the future quantum of fertility in lowest low fertility countries. It starts from the observation of Peter MacDonald that there may be a bifurcation in national fertility trends around TFR of 1.5, with countries falling below this level having a lower chance to recover. This also coincides with the view of Rindfuss et al. concerning possible "demographic regime" changes. Here we discuss two arguments supporting this hypothesis: (1) that ideal family size is a function of the actual number of children experience thus causing a possible downward spiral in fertility; and (2) that following Easterlin’s relative income argument, the fertility of the young generation results from the combination of their aspirations for material consumption and their expected income, with the latter declining due to population aging. This also implies a downward spiral of fertility.