HUMAN CAPITAL AND FERTILITY DECISIONS IN ITALY: A MICROECONOMETRIC ANALYSIS OF ECHP DATA

In this paper we have studied the linkages between fertility decisions and human capital of both males and females in Italy by using the eight waves available in the European Community Household Panel (ECHP) data. In this aim, we have followed two steps. In the first step, we have considered ‘education’ as an exogenous variable and we have implemented a pooled probit model. In the second step, we have considered ‘education’ as an endogenous variable and, hence, we have estimated an instrumental variable probit model. The main objective has been to measure the effects of the human capital, proxied by the years of schooling, on the probability of having a new child obtaining a sort of trade-off between them in an endogenous variable case.