Wired has a decent article on why family sizes are shrinking, called "The Natural History of the Only Child."
"exactly why families are shrinking is a mystery. Rising living standards seem to have something to do with it. It's certainly true that as living standards rose in England -- as children died less from diseases, as the country overall became richer -- the size of the English family shrank. When other countries became wealthier, their families shrank, too. These days, affluent countries tend as a rule to have smaller families than poor ones."I have read and written thoughts about this before, but the key the author found was a good one: It is the biological idea of what it costs to raise a child. As the idea moves from "I have to feed them and have them so they can help me survive" to "I have to feed them and clothe them and send them to college" to "I have to feed them and clothe them and buy them lots of things and send them to college and I want a big screen TV", we have less children, just as animals weigh their ability to "pay" the cost of having offspring.
"It turns out that animals have evolved a balance between offspring and effort. Some can even adjust how many offspring they produce, depending on whether they are under stress or live comfortably. Ruth Mace, an expert on family size at Imperial College London, argues this week in the journal Science that humans are governed by the same kinds of rules. When the standard of living goes up, the cost of living goes up too. It takes a family in Addis Ababa (the urban capitol of Ethiopia) a lot more money to raise an additional child than a family out in the Ethiopian countryside. That may be one reason why the population is exploding in rural Ethiopia, while in Addis Ababa it is actually shrinking."Of course, some people, such as myself, make the conscious decision that "I can't pay for all of them to go to college, so I will have to raise them to work hard and get good grades", in other words, downgrade what is perceived as necessary to raise a child, and then we have more children.
"If Mace is right, then as long as the world keeps creeping out of poverty, families will continue to shrink. How small they can go is an open question. But perhaps we should stop thinking of families with only children as some odd fluke of neurotic New York life. It's just human biology played out to a logical extreme."