Delayed childbearing and urban revival

This paper highlights the role of delayed childbearing as an important
driver of urban revival in U.S. cities. While downtown neighborhoods provide
shorter commuting times and more consumption amenities, limited housing
space and schools’ worse quality considerably reduce the value of this location
when children are born. As households postponed parenthood, the life period in which individuals benefit the most from living downtown extended. Consequently, demand for downtown locations increased, contributing to urban revival. We first provide reduced-form evidence of the interaction between delayed childbearing and urban revival. We exploit exogenous variation in access to Assisted Reproductive Technology (ART) to obtain causal estimates of the impact of delayed parenthood. The higher availability of ART increased
income downtown by 5.4% relative to the suburbs. We then estimate a spatial equilibrium model that incorporates a fertility timing decision and a within-city location choice. We calculate the counterfactual urban revival keeping the incentives to have children constant at its 1990 level. We explore the incentives coming from (i) taste for children, (ii) downtown amenities, and (iii) income child penalties. We find that the change in incentives to delay
childbearing can generate a large share of the faster income growth downtown relative to the suburbs.