Family Formation during the Hungarian Societal Transition: Trends in Postponement and the Impact of Policy Changes

Arnstein Aassve, University of Leicester
Francesco C. Billari, Università Bocconi
Zsolt Speder, Hungarian Central Statistical Office

In this paper we focus on two questions concerning family formation during the Hungarian societal transition. First, to what extent has the dynamics of economic activity and wellbeing changed the timing of first union formation and first birth? Second, what has the impact of policy changes been? We use a unique and recent micro-level dataset: the Hungarian Social and Demographic Panel Survey, released in 2002. We estimate survivor functions to illustrate the dramatic changes that have taken place among Hungarian birth cohorts. We then use semi-parametric hazard regression models for the timing of first union and first birth to disentangle the interplay between cohort, period effects and individual-level characteristics. Our results indicate that the decline in economic activity had a severe impact on family formation. Nevertheless, certain policies have exacerbated this effect, and policy changes during the 1990s had an asymmetric impact --- depending on the social status of individuals.