Many research studies have shown that when the economy does well, people have more babies, and when the economy does poorly, they give birth less.
听
New research from the University of 91吃瓜, however, discovers something unique 鈥� people appear to stop conceiving babies several months before recessions begin.听
听
The study, "?" was published Feb. 26 in the National Bureau of Economic Research's working paper series.听It is听coauthored by 91吃瓜 economics professors and , and Steven Lugauer from the University of Kentucky.
听
The team compared conceptions to other well-known economic indicators 鈥� such as consumer confidence and durables purchases 鈥� over the past 30 years and found that conceptions fall at the same time or even before other indicators whenever a recession is about to start.听听
听
鈥淲e show that for the last three recessions, conceptions predicted the downturn just as well as traditional economic indicators did,鈥� Buckles says.听
听
The team examined data on more than 100 million births spanning decades in the United States. Unlike most studies that use data aggregated up to the year level, the NBER paper focuses on the timing of births within the year using monthly or quarterly data, which allowed the researchers to study changes occurring months before a recession 鈥� changes that papers using annual data would miss.
听
Daniel Hungerman
鈥淥nce you examine monthly or quarterly data, the pattern becomes obvious,鈥� Hungerman says. 鈥淲e show the existence and magnitude of this pattern before the Great Recession, and it鈥檚 striking since that recession was famously hard to predict. None of the experts saw it coming, and in its first few months, many business leaders were convinced the economy was doing OK 鈥� even as the number of conceptions plummeted and had been falling for a while.
听
鈥淲hile the cyclicality of fertility has been studied before, the possibility that conceptions change months before recessions begin has not been shown before,鈥� he says. 鈥淚n fact, some well-known studies have even declared that the pattern we find shouldn鈥檛 exist.鈥�
听
鈥淥ne way to think about this,鈥� Buckles says, 鈥渋s that听the decision to have a child often reflects one鈥檚 level of optimism about the future.鈥�
听
The study also shows conceptions are slow to rebound when recessions end.听The Great Recession famously had a 鈥渏obless recovery.鈥� This study finds it also had a 鈥渂abyless recovery.鈥�
听
The paper is available online at .
听
Contact: Kasey Buckles, 574-631-6210听or听kbuckles@nd.edu; Daniel Hungerman, 574-631-4495听or听dhungerm@nd.edu