My husband and I have a son and we’re thinking of having one or two more children. But how many, do you think?
— Emma Travers, York
When optimising your investment in children, it’s erroneous to consider quantity without thinking of quality. The most famous economist to make this mistake was Malthus: he predicted that whenever household incomes rose, families would expand to consume the new resources.
Malthus did not anticipate advances in contraception, which make it much more likely that people like you can have exactly the number of children they desire. An equally important error – if a more subtle one – was his failure to appreciate that as incomes rise, parents can increase their investment in children not just by having more, but by spending more time and money on each child.
In the analysis of the Nobel laureate Gary Becker, you can increase the quality of your children as well as their quantity, for example by investing in their education. Becker understood that children can be analysed in the same way as other durable consumer goods, such as cars.
Nobody would make Malthus’s mistake by assuming that millionaires buy dozens of cheap cars. We all realise that a more typical response to rising income is to replace the Skoda with a Mercedes. It is hard to give you more specific advice without knowing more about your situation, but if you appreciate that your choice is between two high-quality children and three lower-quality children, things may become clearer in your mind.
Some people protest that children cannot be traded off against other consumer durables, or even analysed in the same way. Perhaps. But it’s interesting to note how many of these people have few children but nice cars.
First published on ft.com.