| Summary: | Southern Europe's rapid fertility decline has resulted in a positive cross-country correlation between female labor force participation and fertility. We develop a model with heterogeneity in attitudes towards women's home time and a social externality associated to men's home production to explain (1) this positive correlation and (2) its intertemporal reversal. Implications of the theory are evaluated using the multi-country ISSP94 household survey. We find that, within countries, households with less egalitarian attitudes have more children but lower female labor force participation. However, consistent with the presence of social externalities, countries with less egalitarian views have lower average fertility.
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