John C. Caldwell (1976) called for a restatement of DTT [demographic transition theory] […]. His theory of wealth flows is grounded in the assumption that the “emotional” nucleation of the family is crucial for lower fertility. This occurs when parents become less concerned with ancestors and extended family relatives and more so with their children, their children’s future, and even the future of their children’s children (Caldwell,1976: 322). He argued that ideally there are essentially two types of societies; the first is where “the economically rational response is an indefinitely large number of children, and the second where it is childless” (p. 322). But why, from an economic view, would couples want either an unlimited number of children or none at all? Caldwell explains that it depends on the direction of the intergenerational flows of wealth and services. If the flows run from children to their parents, it is entirely rational for parents to want to have large families. In modern societies, where the flow of wealth and services is from parents to children, it is rational to want small families. To say that parents in the less-developed countries today are “irrational” because they continue to have large families is to misunderstand these societies. In Caldwell’s view, fertility behavior is rational in virtually all societies, irrespective of their levels of development (Poston and Terrell, 2006).
Poston and Bouvier, Population and Society: An Introduction to Demography, page 274