How Fertility Behavior Responds to Trade Shock: Evidence from China

This paper examines the fertility effect of a trade shock induced by China’s accession to the WTO by exploiting the variation in regional exposure to the shock. We find that trade uncertainty decline restrains fertility by both delaying childbearing and reducing lifetime fertility. Overall, the negative effect is larger in urban areas and for couples that already have children, especially sons. In addition, consistent with Becker’s model, the shock to females decreases fertility, but the shock to males has an opposite impact. Finally, with son preference, higher opportunity cost raises the probability of the first child being a boy.