Does the expectation of having to look after parents in the future affect current fertility?

Abstract This paper argues that the expectation of having to provide care for aging parents in the future may be a major factor contributing to the current low fertility rate in Japan. Using data from the 1998 and 2008 National Family Research of Japan (NFRJ) surveys and a Poisson-logit hurdle model, this paper examines whether the expectation of having to look after parents in the future affects a couple's current family planning. The first-stage model of a couple's family planning decision is a logit model which examines the decision of whether or not to have any children, and then in the second stage a Poisson model is applied to explain the number of children a couple has conditional on the couple having at least one child. The empirical evidence presented suggests that there are strong generational effects, and that for the post-war cohort, an increase in the probability of having to look after a parent increases the probability of a couple being childless.