Relative income and fertility

The present study examines the relationship between relative income (i.e., actual income in relation to the expected income of one's socioeconomic group) and fertility, using data collected by the 1967-1968 Canadian Family Growth Study (Balakrishnan et al., 1975). We broaden the tests of relative income beyond cumulative fertility to spacing behavior and then examine some of assumptions included in the relative income model of fertility. Results of the tests, in brief, are as follows: (a) Relative income is found to be more closely related to spacing than to cumulative fertility; and (b) the relationship between relative income and fertility is strongest among those couples who plan their life ahead and have a high level of education and occupation, and when temporal alignment is brought between the measures of relative income and fertility. For the relative income model to receive confirmation, it was specified that the following hypotheses must be confirmed: (a) that fertility behavior would vary positively with relative income but the fertility norm would show no relationship with relative income: and (b) that consumption norms and behavior would show no relationship with relative income. The outcome of these tests are in the expected direction, giving support to the relative income model. In addition, there is some evidence of predictive capability of the relative income model for correlative behavior.