Fewer, Richer, Greener

4Having Fewer Children: “People Respond to Incentives”

Most of economics can be summarized in four words: ‘People respond to incentives.’ The rest is commentary.”

Channeling Rabbi Hillel of Babylon, so says Steven Landsburg, professor at the University of Rochester and author of The Armchair Economist: Economics and Everyday Life.¹ If there are a few simple precepts to be learned from a study of economics, they are:

• Needs and wants are unlimited.
• Resources are limited.
• All decisions involve trade-offs.
• People respond to incentives.

The first three precepts are a way of saying “you can’t have everything.” (Steven Wright, the heady comic, added, “If you could, where would you put it?”) The fourth is the topic of this chapter, which argues that people responding to incentives are the cause of the population explosion coming to an end in our time, just as they caused the population explosion to start in the first place. People decide how many children to have based on a conscious or unconscious calculation about what is best for themselves and the children they do or do not have.

The idea that choosing how many children to have is (or can be) a utilitarian calculation discomforts some people. The resistance comes from believing that having children is a deeply personal, even spiritual, decision that economics should have little part of. Yet there is a rich body of respected research, led by that icon of twentieth-century economics, Nobel Prize winner Gary Becker of the University ...