Well, not quite but Bryan Caplan reports that out of wedlock births are what’s keeping the US fertility rate as high as it is:

The U.S. has a much higher total fertility rate than Japan.  The U.S. is roughly at replacement: 2.1 kids per woman.   Japan, in contrast, is way down at 1.3.  This means, amazingly, that American and Japanese moms give birth to almost exactly the same average number of in-wedlock babies: 1.26 versus 1.27.  The difference: American moms then go on to have an additional .84 babies out of wedlock, versus only .03 for Japanese moms.

This adds another layer of complexity to dealing with the problem of intergenerational poverty. Poorly educated women with few prospects are more likely to have children out of wedlock. Traditional thinking is that expending educational opportunities will not only raise their income but encourage them to postpone pregnancy until their in a better financial position.

Yet, does this postponement necessarily mean imply a declining population and additional strains on our public retirement system? At some point does it imply a declining demand for capital and hence declining real equity prices as the workforce shrinks?

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