Long-term effects of economic recession on fertility: the case of South Korea

Doo-Sub Kim, Hanyang University
Sam Hyun Yoo, Wittgenstein Centre (IIASA, VID/ÖAW, WU) and International Institute for Applied Systems Analysis (IIASA)

Economic recession influences the level and timing of fertility. Fertility frequently declines during economic recessions, and worsening economic conditions also lead to fertility postponement. However, the literature primarily focuses on the temporal detriments in economic aspects like changes in unemployment rate at macro and micro levels. An economic recession, especially if it is prolonged and severe, may lead to broader societal changes that might last a long time. Furthermore, research analyzing the economic impacts on fertility outside of Western nations has been rare. To address this research gap, we investigate the impacts of economic recession on fertility in South Korea. The country was the most affected by the Asian Economic Crisis in the late 1990s among East and Southeast Asian countries. We test whether the economic crisis has changed how women value children and has led to lower levels of completed fertility. We also investigate how recession effects differ by educational level. We use the 2% sample data from the 2005 and 2010 Population and Housing Census and the Korea National Surveys on Fertility, Family Health and Welfare between 1991 and 2012, a series of cross-sectional surveys conducted every three years. We review trends in marriage and fertility and conduct both macro- and micro-level analysis. Results suggest that the economic crisis in the late 1990s lowered the value of children among ever-married women, which had already been in a declining trend. The recession also delayed women’s marriage and childbearing leading to a decline in cohort fertility; completed fertility was mainly mediated by the timing of first marriage. The negative recession effects were more pronounced among women married at later ages and those who had secondary education or less. Our study suggests that changes in values, attitudes, and fertility behaviors triggered by an economic recession can last longer than a decade.