Sharing the Burden of Death: Implicit Family Insurance, Mortality Shocks, and Fertility and Child Health

Olumide Taiwo, Brown University

This paper studies the effects of insurance in kinship networks on fertility and child health. Using demographic data from Malawi and exploiting differences between the patrilineal and matrilineal kinship in the composition of family network groups, we find that the death of an adult kin and the resulting orphan care in a risk sharing network significantly reduces fertility. We do not find evidence for intra-household discrimination against fostered orphans in terms of human capital investments, but orphans provide more labor than biological children. This income effect translates into improvement in the nutritional status of biological children of preschool age. The results suggest ways in which risks and informal insurance affects demographic outcomes in societies characterized by implicit family contractual insurance. The presence of these effects also suggests that demand decisions under social insurance may depend on a set of constraints that is larger than those assumed in the fertility literature.

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Presented in Session 136: Demographic, Health and Economic Consequences of Weather Risk