Publication Title: University of Pretoria, Department of Economics Working Paper Series
Abstract: We develop a model linking contraceptive efficiency to birth spacing decisions that incorporates the costs and benefits of child-rearing on the potential mother, as well as the stochastic process surrounding human reproduction. The model fits within the realm of optimal stopping-time problems, which naturally leads to the development of a First Hit Time duration model that we estimate using data from the Democratic Republic of Congo. Increased contraceptive efficacy is found to increase time to first birth. Furthermore, the results are consistent with the hypothesis that children are normal goods, in that both income and child-related benefits are associated with decreased durations to childbirth.