Publication Title: Journal of Population and Social Studies

Pages: 202-218

Abstract: Eradication of extreme poverty and hunger has been identified as the number one priority for the Millennium Development Goals (MDGs). Theoretical work on the effect of the number of children on household well-being suggests a negative effect, since the resources available are divided among more household members. The vast majority of empirical studies find results consistent with this expectation, but some fail to link high fertility to lower well-being of the household. The purpose of this paper is to document the effect of the number of children on the consumption expenditure of Ethiopian households. The study uses data from a household sample survey of rural and urban married women and employs a Two-Stage Least Squares (2SLS) model. Analysis is made separately for per capita consumption and equivalized consumption. Results suggest that while the relationship is negative and statistically significant for all expenditure scenarios for the rural sub-sample and for the full sample, this is not the case for the urban sub-sample. Our results confirm the theoretical prediction that the effect of a large number of children on consumption expenditure of households is negative for rural households, whereas results for urban households are not as clear.