# Wealth, Preferences, and Culture

Low fertility isn't caused by poverty but by culturally inflated standards for parenthood, a pattern that extends to how we use money, time, and productivity.

I often read that fertility is low because people cannot afford to have children. If that were true, though, we would expect higher fertility in wealthy countries and lower fertility in poorer ones; yet, the opposite occurs. That said, there is a common objection to this argument:

"But Luca, what matters is not absolute wealth; it's that in wealthier countries, having children is more expensive in relative terms. Think about how expensive it is to provide childcare or to upgrade to a larger house when starting a family."

Upgrading to a larger house is indeed expensive, but it is not mandatory. Consider this: the average dwelling size per capita in the US is about double that of Europe, about four times that of Sub-Saharan Africa, and about six to eight times that of Europeans a few centuries ago. Lack of space has never been an impediment to having children.

This is why the idea that people aren't having children because they cannot afford it is generally wrong (though there are exceptions). If they had more money, they would mostly spend it to move into larger houses or more desirable areas, not to have more children.

"But Luca, it's not just the house. It's also paying for the children's activities and education." Well, ancestors didn't have the money to send their children to varsity sports, art classes, or college, but they didn't consider that a reason not to have them. For today's average person, more money would lead to more "required" activities and degrees, not to more children. This is indeed what happened over the last few decades. After all, even where childcare is nearly free, as in Finland, fertility is still among the lowest in Europe.

Don't get me wrong. I'm not saying affordable childcare isn't important. I think it should be free, or near-free. I just don't think it would move the needle when it comes to fertility, because the bottleneck is elsewhere. Where, though?

We can find it by looking at what changed over the decades in which fertility shrank. It's not that becoming a parent has become more expensive; it's that the culturally defined minimum acceptable standard for both adulthood and parenthood skyrocketed. Our ancestors had children at an earlier age because they didn't believe they needed a degree, a large house, and a stable job to start conceiving. And they had more of them with far less material comfort because they did not believe that every child required a private bedroom, years of curated activities, expensive childcare, university preparation, and constant supervision, all while both parents maintained a modern middle-class lifestyle.

The point is: **the reason people aren't having children is not that they lack money, but that they _feel_ they lack money.**

This may sound like a trivial distinction, but it makes a world of difference: it means the problem requires cultural solutions, not financial ones.

Governments have tested the financial ones: Hungary spends around 5% of GDP on family incentives, South Korea has spent over $200 billion since 2006, and fertility has barely moved in either country.

A cultural solution starts with acknowledging that the belief that one cannot have children until one has a comfortable life is one of the cultural beliefs at the root of the fertility crisis, and one that gets stronger the more we entertain it. And it requires acknowledging, far and wide, that our ancestors had more children with far less.

Preferring a better lifestyle over another child is a legitimate choice, but misdescribing it as poverty is not, because the misdescription points all our solutions in the wrong direction.

## The broader problem

In the previous section, we saw how we say we need more money to have children, but when we get the money, we mostly spend it to improve our lifestyle or future earning power, not on having children. (If this seems false, it's because we look at how we say we would spend the next extra grand, rather than at how we spent the last one.)

This phenomenon extends beyond money. We say we need more time to do X, but when we get more time, we spend it on other things rather than X. We say we need safer cars, but when we get them, we drive faster. And we say we want to work less, but when productivity increases, we mostly prefer working the same amount in exchange for a richer lifestyle.

None of these statements is fully true, but each is at least partially true, and often predominantly so.

And none of these choices is morally wrong; people can make their own decisions. But we should acknowledge that the limit is not a lack of resources but culturally driven choices about how to use them.

More money, more time, more productivity: none of it will matter unless we first change our priorities.