Agricultural Technological Change, Female Earnings and Fertility: Evidence from Brazil

I study how agricultural technological change affects labour market opportunities and fertility in a developing country context. Exploiting plausibly exogenous variation in the adoption of genetically engineered soy across municipalities in Brazil, I show that this labour-saving technology reduced female agricultural earnings and employment without inducing any female sectoral reallocation. Furthermore, this technology adoption increased fertility due to increases in overall household earnings and substitution effects driven by the reduction in female labour demand. These results suggest that technological progress in developing countries may not improve female economic opportunities or lower fertility unless substitution effects are negative and sufficiently large.