Does Fertility Respond to Financial Incentives?

By Guy Laroque, Bernard Salanié. Social Science Research Network, 2008

179 citations recorded by the source corpus.

There has been little empirical work evaluating the sensitivity of fertility to financial incentives at the household level. We put forward an identification strategy that relies on the fact that variation of wages induces variation in benefits and tax credits among "comparable" households. We implement this approach by estimating a discrete choice model of female participation and fertility, using individual data from the French Labor Force Survey and a fairly detailed representation of the French tax-benefit system. Our results suggest that financial incentives play a notable role in determining fertility decisions in France, both for the first and for the third child. As an example, an unconditional child benefit with a direct cost of 0.3% of GDP might raise total fertility by about 0.3 point.

Subfields: Demography, Gender Studies, General Health Professions

View Paper: https://www.semanticscholar.org/paper/0255659d1b97fcb0aef3961fe17f975087341321

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Demography

1. O. Thévenon
2. Katharina Wrohlich
3. P. Haan
4. Daniela Del Boca
5. C. Marbot
6. Robert M. Sauer
7. A. Gauthier
8. P. Givord

In Gender Studies

1. P. Haan
2. A. Gauthier
3. O. Thévenon
4. Robert M. Sauer
5. Katharina Wrohlich
6. Daniela Del Boca
7. C. Marbot
8. P. Givord

In General Health Professions

1. P. Haan
2. O. Thévenon
3. C. Marbot
4. Katharina Wrohlich
5. A. Gauthier
6. P. Givord

Citations in the corpus

• Life Cycle Employment and Fertility Across Institutional Environments (2009, background): “…an especially large increase in the 18 The extension of Allocation Parentale d’ ‘Education (APE) to births of parity 2 in 1994 is often cited as a cause of the recent growth in fertility (Laroque and Salaniè, 2005). participation of more educated Spanish women when facing the Italian parameters.”
• Can Child Care Policy Encourage Employment and Fertility? Evidence from a Structural Model (2009, methodology): “In particular, we follow the idea of Laroque and Salanie (2004) and Laroque and Salanie (2008) and use an identification strategy that relies on the fact that employment and fertility behavior induces variation in the net incomes through the tax and transfer system and through child care…”
• The Career Costs of Children (2017, unknown): “107 for Canada, Cohen, Dehejia, and Romanov (2010) show that a doubling of the child subsidy leads to an increase in fertility of about 17 percent, and Laroque and Salanié (2008) report that an increase in child subsidy of 1,800 euros per year increases fertility by 14 percent.”
• Family policies in developed countries: a ‘fertility-booster’ with side-effects (2011, background): “Pailhé (2009) considers that the availability of formal childcare for children aged under three is a factor explaining differences in fertility intentions between France, Germany, and Russia.”
• Does the cost of child care affect female labor market participation? An evaluation of a French reform of childcare subsidies (2015, background): “Both these elements discourage the labor force participation of mothers 3In France, the members of a household are likely to declare their income separately - this is for example the case of unmarried couples.”