Income Shocks, Contraceptive Use, and Timing of Fertility

This paper examines the relationship between income shocks and fertility decisions. Using panel data from Tanzania, we estimate the impact of agricultural shocks on pregnancies, births, and contraception use. The likelihood of pregnancies and childbirth are significantly lower for households that experience a crop shock. Furthermore, women have significantly higher contraception use after crop losses. The increase in contraceptive use comes almost entirely from traditional contraceptive methods, such as abstinence and the rhythm method. We argue that these changes in behavior are the result of deliberate decisions of the households rather than the shocks' effects on other factors that influence fertility, such as women's health status, the absence or migration of a spouse, the dissolution of partnerships, or the number of hours worked. We also show that, although traditional contraceptives have low overall efficacy, households with a strong incentive to postpone fertility are very effective at using them.