Fertility, Intergenerational Transfers and Economic Development in South Africa

South Africa has a high level of teen fertility, which is worrying for a number of reasons. Most of the teen fertility is non-marital, and teen mothers are much less likely to finish high school, with potentially important consequences for their own employment opportunities and for the human capital of their children. In such a situation it is useful to know what the potential impact of reducing teen fertility might be on women’s human capital and earnings.

Another defining characteristic of the South African population is its complex pattern of intergenerational support. South Africa’s patterns of household formation are such that many young South Africans co-reside with grandparents. In addition, South Africa’s large state old age pension gives the elderly the financial resources to support younger family whether or not they are co-resident. The Child Support Grant also brings resources to the caregivers of children. Research has shown that these intergenerational support systems and public transfers play an important role in human capital accumulation and labour force activity of young people.

Objectives

This project brought together economists and demographers from the University of Cape Town and the University of Michigan to analyse the links between fertility, intergenerational transfers and economic development in South Africa. The project built on a ten-year history of collaborative research between UM and UCT. The project focused on demographic behaviours and economic outcomes at the household level in South Africa, paying particular attention to the economic consequences of South Africa’s high level of teen fertility. It also analysed the extent to which government support systems mediate these impacts.

The main data-sets utilized were the Cape Area Panel Study and National Income Dynamics Study.

Outcomes

The primary outcome from the project was a series of research papers exploring links between economic demography and economic development in South Africa. The focus of this research was on the potential economic consequences of South Africa’s high levels of teen fertility and the unusual pattern of intergenerational support and public transfers.

Publications

Ardington, C., Branson, N., Lam, D., Leibbrandt, M.,Marteleto, L., Menendez, A., Mutevedzi, T. and Ranchhod, V. (2011). Revisiting the ‘crisis’ in teen births: What is the impact of teen births on young mothers and their children?, SALDRU Policy Brief 1.
Branson, N., Ardington, C. and Leibbrandt, M. (2011). Health outcomes for children born to teen mothers in Cape Town, SALDRU Working Paper 55.
Lam, D., Marteleto, L. and Ranchhod, V. (2009). Schooling and sexual behavior in South Africa: The role of peer effects, Population Studies Centre Report 09-694.
Ranchhod, V., Lam, D., Leibbrandt, M. and Marteleto, L. (2011). Estimating the effect of adolescent fertility on educational attainment in Cape Town using a propensity score weighted regression, SALDRU Working Paper 59.

People