Fertility, inequality and poverty. Evidence from Uruguay

Verónica Amarante, Instituto de Economía, UDELAR

This paper addresses the relationship between fertility, poverty and inequality from a microeconomic perspective. We estimate the magnitude of the effects of fertility changes on mean income, income inequality and poverty, using micro level data for a middle income Latin American country, Uruguay. The specific question that we are trying to address is how much of the change in mean income, poverty and income inequality that took place over the past twenty years (1986-2006) in Uruguay is caused by differential changes in reproductive behavior. Using micro econometric decompositions, we simulate the vector of household income, and implicitly the poverty and inequality level, that would prevail if individuals in the end of the period had taken fertility decisions as they did in the beginning of the period.