Economics of fertility: repercussions and alterations
There are significant economic implications of an ageing population and in developed societies the main cause is the decline in fertility rates. The economic theory of fertility provides an understanding of the demand for children as consumption goods. Determinants of the existing low mature fertility trend: income, education and cost of children are discussed with the respective theories for low fertility: post-materialist values, risk aversion, and rational choice theory. Factors causing a lower quantity of children to be demanded and the postponement of first birth can be altered through government policy to change the existing fertility trend causing population ageing. Current policies are not targeting the key determinants and as a result, causing additional problems. Therefore, suggestions for more effective measures to change fertility rates are put forward.