In a new study in Population Studies, I show that income is associated with higher childbearing in Sweden. The differences are large and are found for both men and women. I accumulate annual income histories from age 20-60 to estimate life course income.
Studies on income and childbearing are surprisingly sparse, in particular, there are few studies that use longitudinal income to measure income over the life-course, which is important as the transitory effect of childbearing on income is very large (in particular for women).
The differences are large, and in particular men and women that are childless have much lower life-course income, with the highest income found for men and women with 3-4 children. Here I show disposable income for men and women born 1960 and 1970.
The study uses Swedish register data on the complete Swedish-born population of men and women born 1940-1970. Income is derived from annual taxation registers and is calculated at the individual level. 10 SEK is approximately 1 USD.
I present two icnome series of A), gross income from earnings and B), disposable income which is net of taxes and includes transfers (including those related to childrearing). The latter includes (parental leave benefits and child allowances which the former does not.
The positive gradient becomes stronger over time, and is negative for women born in the 1940s and 1950s, but become positive for women in the latest cohorts. This reflects the rise of a dual-earner society, and that women have less of a trade-off between career and childbearing.
Income increases with the number of children up to the 5th child, where you find more modest incomes. Having 5 or more children is however very uncommon in Sweden, and in practice, the population level gradient is driven by parities 0 and 1 (low income) vs 2,3,4 (high income).
I also study income across the life course income distribution and find that for men there is a monotonic positive increase between income and childbearing. Men with exceptionally high incomes have the highest income, where the richest have up to twice as many children.
For women, we clearly see the shift of a society where housewives initially had higher fertility (cohorts in 1940), while from the 1960s one finds the lowest fertility among women with very low income. Unlike for men, there is no monotonic increase at very high-income levels.
The results for earnings show stronger gender differences (as parental leave payments and child allowances that are concentrated among women are excluded). Men have consistently childbearing with higher income, while for women the initial negative gradient is much more sharp.
Still, women with 4 children in the latest cohort have close to the same earnings as women with 0 children, despite that these women have 4 spells of parental leave (typically 9 to 12 months) that do not contribute to their accumulated earnings.
In conclusion, the study shows strong evidence of increasing polarization of childbearing in Sweden, where childbearing is increasingly concentrated among the well-to-do. For men, it is particularly clear that above-average family sizes are more common among high-income earners.
There is also a clear gender convergence over time, reflecting a more equal gender division of work and childrearing. Increasing gender equality seems to reinforce polarization of childrearing where both low-income men and women are excluded from union formation and childbearing.
The results are consistent with other socioeconomic determinants of childrearing in Sweden, where similar gradients are emerging for a number of other outcomes.
The results are consistent with my recent study on comparative family policy and childbearing, which also argues for increasing importance and focus on income for childbearing in middle-income and high-income countries.
The positive gradient reported here is (in particular for women) probably not universal in high-income countries, but is plausibly found in more and more contexts across Europe and East Asia. More studies should revisit this very traditional topic of income and fertility.