CDDRL Working Papers
January 10, 2005
This study provides new evidence on the appropriate model of the economic and demographic transition. The episode analyzed is the eradication of hookworm disease in the American South (c. 1910). In previous work (Bleakley 2004), it was shown that the eradication of hookworm disease led to a significant increase in school attendance and literacy. The present study shows that this increase in human capital investment was accompanied by a fertility decrease that was both economically and statistically significant. A decline in the hookworm infection rate from 40 to 20% is associated with a decline in fertility that amounts to 40% of the entire fertility decline observed in the American South between 1910 and 1920. The relative change in fertility and schooling caused by hookworm eradication is approximately equal to aggregate comovements during the period considered. We argue that this evidence is consistent with models of the fertility transition emphasizing economic incentives rather than changing cultural attitudes and birth control technologies. Furthermore our data supports models emphasizing intergenerational altruism. Variables affecting childrens' economic prospects affect parental fertility decisions. A consequence of this finding is that we do not require changes in the economic opportunities faced by parents directly to explain the economic and demographic transition.