An Empirical Investigation of Peer effects on Fertility Preferences

Individual fertility preference is influenced by observed social norms. The present paper estimates the effect of the observed fertility of peers on a woman’s fertility preference. We find that both neighbourhood peers and religious peers have a significant impact on individual fertility preferences, but their relative importance changes with family size. An increase in peer fertility increases the probability of preferring more children. While women’s fertility preferences conform to the changes in observed fertility of their peers, education plays an important role in moderating peer effects. Our results contribute to the understanding of peer effects in fertility as well as possible policy responses.