Report

2015-05-28

Southern Africa Labour and Development Research Unit

University of Cape Town

The paper uses data from the Second Malawi Integrated Household Survey (IHS2) to investigate the impact of fertility on poverty in rural Malawi. We use two measures of poverty; the objective and the subjective. After accounting for endogeneity of fertility by using son preference as an instrumental variable, we find that fertility increases the probability of being objectively poor. This effect is robust for all poverty lines used. It is also robust to accounting for economies of scale and household composition as well as assuming that poverty is continuous. We also find that when fertility is treated as an exogenous variable its impact is underestimated. When poverty is measured subjectively, the results are opposite to those of objective poverty. We find that fertility lowers the likelihood of feeling poor, and that fertility is exogenous with respect to subjective poverty.