Nobel Laureate Claudia Goldin on Birth Rates, Women and US Government Data

Claudia Goldin has been talking nearly babies a lot during the yesteryear yr.

The 79-year-old john harvard University prof, who won the Nobel Prize in economics in 2023 for research on the history of women in labor markets, has recently been investigating birth rates. The topic has been an area of focus for the Trump administration and billionaire Elon Musk, who point to the drop in the US birth rate as a threat to economic growth, while they push against immigration that could offset it. “The decline in almost all developed countries today has been going on for about 40 to 50 years,” Goldin says over Zoom from her office in Cambridge, Massachusetts, in early July. “So why are we just talking about it now?”

In a paper published late last year, “Babies and the Macroeconomy,” Goldin dug into fertility rates in developed countries to suss out what causes some to be lower than others. To start with, she notes, economists have struggled to fully explain why birth rates have fallen across the board with rising incomes and improving living standards. Goldin investigates by focusing on two groups of currently rich nations. The first—Greece, Italy, Japan, Portugal, South Korea and Spain—in recent years have had very low total fertility rates. In Japan as of 2019, for instance, the estimated number of children the average woman would have in her childbearing years was only 1.36. The second group—Denmark, France, Germany, Sweden, the UK and the US—have more moderate rates. In Sweden, by contrast, the total fertility rate was 1.7. 

What’s behind these distinct outcomes? Goldin identifies a thread connecting the very low birth rate countries. Since the 1950s, their economies advanced abruptly, and gender norms around childrearing didn’t have a chance to catch up. One upshot is that women with careers in those countries still bear comparatively larger burdens when they have children, making the choice of having kids less attractive.

The difference turns up in data on gender disparities in household work. In Japan in 2019, women spent around three hours more per day than men taking care of the home and children. By contrast, in Sweden that figure was only about 49 more minutes.

In a wide-ranging interview with Bloomberg Markets, Goldin speaks about birth rates, the barriers remaining for women in the workforce and the fears many economists have now about the integrity of US government economic data. The interview has been edited for length and clarity.

Siobhan Wagner: What made you do a study now on babies and the macroeconomy?

Claudia Goldin: I was asked to give a talk last September to the European Central Bank, a meeting in Germany. I generally don’t accept many invitations. The talk was meant to entertain a group of people who I thought had spent an entire day talking about interest rates and inflation and complicated macro models.

But in addition, if you look back in my Nobel address, there is a line there that says something about the fact that in periods of rapid change, women often benefit enormously and men begin to lose out, relatively. But they lose out because the person who was keeping the house is now leaving [to work outside the home].

In addition, there was a wonderful 2008 paper [“Will the Stork Return to Europe and Japan?”] by Feyrer, Sacerdote and Stern in The Journal of Economic Perspectives. It sets forth the notion of a U shape in [a graph showing fertility versus] female labor force participation. The least developed countries are still way up here [on the left-hand side]—high birth rate, low income per capita—and then you get the more developed countries [at the bottom of the graph], and then you also get a little rise [on the right-hand side], so Sweden and the US are over here [with higher birth rates] and Spain and Italy are over here [at the bottom].

So the question was, why? And my little model began to solve that. 

SW: The paper generated a lot of talk.

CG: I’ve written another [for the Federal Reserve’s Jackson Hole Economic Policy Symposium in late August]. I’m giving a spinoff there called “The Downside of Fertility.”

SW: What is that going to be about?

CG: It’s about fertility decline. It begins with a very simple statement: Fertility decline is everywhere. And the second point is, the decline in almost all developed countries today has been going on for about 40 to 50 years. So why are we just talking about it now?

The downside of fertility almost always concerns the changes in what is concerning to women. It’s that female autonomy, female independence, female everything is expanded. This often begins with the ability to control fertility, to control one’s reproductive fate. But it is also the case with more education, with more ability to be employed, there are other sets of rights that come in that bolster women.

SW: Your “Babies and the Macroeconomy” paper looked at the impact of the economy on fertility rather than the flip side: how birth rates affect the economy. Is there anything that you have learned about what impact, say, a rising birth rate could have on the economy?

CG: I’ve learned one thing: It’s impossible to find an actual answer. [Brown University economist] David Weil, who is my go-to person on this, has written a wonderful piece [called “Replacement Fertility Is Neither Natural Nor Optimal Nor Likely”]. So the rate at which we reproduce ourselves, the 2.1 [total fertility rate] figure—there’s nothing telling us that that’s the right thing.

In addition, there are other problems. Another go-to person on this is [Stanford University researcher] Charles Jones, who writes papers on exactly these topics, whether we as a world are headed towards wiping ourselves out.

And in the background of this is the fact [that] there are many very, very smart people who write down models and study whether having more young people leads to more inventiveness. If you bring the rate of reproduction down, you’re changing the percentage of people in each of the age groups. If having more older people leads to a slowdown in technology, then you’re actually changing the growth economy, the macroeconomy itself.

SW: When I speak to women in their 30s and 40s who say they don’t want children, one of the common things that comes up is they say they’re worried about overpopulation, or climate change, or wars and other instability. Is there any way for you to track if that may be a reason that there’s a decline in the birth rate?

CG: Why do I care?

SW: I guess that’s a good point.

CG: I don’t think anyone today truly believes that there’s “overpopulation.” They might believe that there’s climate change. There are lots of things that we as citizens of this world should think about. But in 1972, when I graduated from graduate school, what everyone was talking about was: This is a horrible time to bring a baby into this world because there is overpopulation. We are not a peaceful people. We killed all these lovely people in Cambodia and Laos and Vietnam. We don’t have a government that we trust. Think of Watergate. That was a moment when people were saying that [there’s overpopulation]. Those people actually then went on to have babies.

SW: I guess that’s the problem with even some surveys on this topic. It’s just a capture of a moment in time, and then you could totally change your mind or have a totally different view a week from then.

CG: When I talk to women—and that’s a small survey—about what they want, it’s not: Should I bring this baby into an ever-warming world? It’s really: Do I have the resources? Can I trust the father of this child to be there and do 50-50 with me? Are there convenient day-care options or child-care options? It’s really the bread-and-butter stuff.

SW: I want to ask you about the rise of greedy work—higher-paying jobs that typically require more hours. I was wondering if you feel this model is becoming more entrenched in companies?

CG: I don’t really think of it as a model. As an economist, I think we have these production relationships. And these sort of work for individuals who can devote their full days and vacations and evenings and weekends and dinnertime to the corporation. But hopefully more men step back and say: “This is a moment in my life that is very important. My children are precious, and my weekends, my evenings and my vacations are mine. Go away.” We actually have seen this for many of the young people. My students who go off to Goldman or McKinsey, they have said, “We want our time.”

SW: Speaking of time, with the post-pandemic shift to hybrid work and remote work, some people have hailed that as the potential solution for the motherhood penalty by offering more flexibility. Now in some cities more people are being asked to come back to work either four or five days a week.

CG: They are, but we can see in the data that it’s still about 20-something percent of full working days are remote.

SW: Do you think we’re not going back to the five days a week then?

CG: We’re not going back.

SW: Still, there are banks and hedge funds that are pushing it.

CG: They’re pushing for certain workers to come in certain days. I think that one of the problems is that if people are allowed to spend whatever day they want off, then you have real problems of community coordination, of making certain that the newbies are well trained, that everyone is treated equally. So you need to have rules. When you say “back to the office,” practically no one is saying every moment back to the office. I think that giving your workers flexibility is giving them a tremendous amount. That means that you benefit, but you don’t want then for everyone in your community, in your firm, in your office, in your department to suffer because of it. I think it’s that balance. We’ve gained a tremendous amount. The pandemic had a true silver lining.

SW: On another topic, I read earlier this year you were concerned about the misuse and removal of some government data. I was just wondering what kind of challenges that is creating for you and other economists?

CG: This is going to create horrible challenges. In the future, I can’t even imagine. There are many datasets that have been paused that can’t be put back together again because they’re longitudinal.

SW: So the actual integrity of the data going forward?

CG: Right. Yeah. It is the integrity of the data. And we have always viewed the data coming out of the BLS [Bureau of Labor Statistics], for example, as nonpolitical data. The data are just collected. But of course we’ve been there before. I mean, this isn’t the first time that data have become political.[On Aug. 1, President Donald Trump fired BLS Commissioner Erika McEntarfer after a disappointing July jobs report. In response to the firing, Goldin said in an email on Aug. 5 that this has only “confirmed” her concerns about data integrity, saying she also now has “further fears” about the Consumer Price Index and the future of the Federal Reserve chair.]

SW: In terms of politics, is the ongoing tussle between Harvard and Trump making things tough for you and your colleagues?

CG: The big problems are our students and visas. I don’t think people realize just what a big problem that is and the fact that our students still don’t know if they can get visas. There are in total, including the graduate students and the postdocs, about 6,000.

SW: Does it make your day-to-day work any more difficult at all?

CG: Well, there’s a student outside my office right now.

SW: I’ll let you get to that.

Wagner is an editor for Green and environmental, social and governance at Bloomberg News in London.

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