Contraception and the Fertility Transition

Three profound changes - the mortality, fertility and contraception transitions - characterized the Victorian era in England. Economists, following Becker (1960), focus on the first two and underplay the third by assuming couples can achieve their fertility target at no cost. The historical experience from Victorian England is at odds with this view of costless fertility regulation. We incorporate costly fertility limitation into the Becker paradigm: in our story, the mortality transition spurs on a contraception revolution which, in turn, makes it possible for the fertility transition to arrive. In the model, generationally-linked households with heterogeneous income choose between two contraception strategies, one ``traditional'', the other ``modern''. The modern comes with a higher fixed cost (reflecting social opposition and informational barriers characteristic of the times), but has a lower variable cost when it comes to averting childbirths. While the initial adopters of the modern technology are the rich -- those unfazed by the higher fixed cost -- eventually everyone switches so as to economize on the variable cost. What hastens the switch is the decline in child mortality. Increased adoption of modern contraception unleashes a social diffusion process causing more people to switch, lowering fertility further and across all socioeconomic groups. The model is consistent with broad time-series and cross-sectional patterns of the English fertility transition.