Who Has Time for More (Children)? Outsourcing Household Chores and the Positive SES Gradient in Swedish Fertility

Despite generous welfare and family policies, Sweden has a sizeable positive socioeconomic gradient in fertility; those with higher incomes have more children than those with lower incomes. While this positive socioeconomic gradient in fertility is not a new phenomenon in Sweden, a similar shift towards a positive fertility gradient is more recently seen in other high-income countries as well. Among potential explanations, this gap could derive from a (perceived) lack of resources necessary for childrearing among lower socioeconomic groups. While the welfare state reduces the economic cost of childbearing and childrearing for all, higher SES groups can consume services alleviating the burden of time-consuming childrearing that aren't accessible to lower SES groups. One of such services is the outsourcing of household chores.

Sweden has a uniquely generous and accessible tax deduction reducing the cost of formal outsourcing of various domestic services by 50%. Whereas domestic services are often part of an informal market and thus undocumented, this generous tax deduction has resulted in a substantial share of such services being documented in Sweden. This creates a unique opportunity to study if and how "buying time" - and a lack of time more generally - is related to the internationally increasingly common positive SES gradient in fertility. Time constraints could either directly affect (continued) childbearing, or indirectly through union stability. That is, to understand if and how outsourcing and time constraints are related to childbearing, we do not only study the fertility outcomes of stable couples, but also of those separating.

This paper is based on individual-level longitudinal register-based data covering all adult Swedes. To address the relationship between regular outsourcing and the socioeconomic fertility gradient we use a novel decomposition method specifically designed to analyze how an intervention, here outsourcing, affects disparities between groups, here fertility differences between socioeconomic groups.