TY  - JOUR
AU  - Rose,Andrew K.
AU  - Supaat,Saktiandi
TI  - Fertility and the Real Exchange Rate
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 13263
PY  - 2007
Y2  - July 2007
UR  - http://www.nber.org/papers/w13263
L1  - http://www.nber.org/papers/w13263.pdf
N1  - Author contact info:
Andrew K. Rose
Haas School of Business Administration
University of California, Berkeley
Berkeley, CA 94720-1900
Tel: 510/642-6609
Fax: 510/642-4700
E-Mail: arose@haas.berkeley.edu

Saktiandi Supaat
Monetary Authority of Singapore
10 Shenton Way
Singapore 079117
E-Mail: saktiandi@mas.gov.sg
AB  - We use a quinquennial data set covering 87 countries between 1975 and 2005 to investigate the relationship between fertility and the real effective exchange rate.  Theoretically a country experiencing a decline in its fertility rate can be expected to have higher savings, lower investment, a current account surplus, and accordingly a real depreciation.  We test and confirm this hypothesis, controlling for a host of potential determinants such as PPP deviations and the Balassa-Samuelson effect.  We find a statistically significant and robust link between fertility and the exchange rate.   Our point-estimate is that a decline in the fertility rate of one child per woman is associated with a depreciation of approximately .15% in the real effective exchange rate.
ER  -