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Subsidizing the Stork: New Evidence on Tax Incentives and Fertility

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Author Info
Kevin Milligan (University of British Columbia)

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Abstract

This paper exploits the introduction of a pronatalist transfer policy in the Canadian province of Quebec that paid up to C$8,000 to families having a child. I implement a quasi-experimental strategy by forming treatment and control groups defined by time, jurisdiction, and family type. The incentive was available broadly, rather than to a narrow population as studied in previous work, providing an exceptional opportunity to investigate heterogeneous responses. I find a strong effect of the policy on fertility, and some evidence of a heterogeneous response that may help reconcile these results with previous estimates. Copyright (c) 2005 President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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File URL: http://www.mitpressjournals.org/doi/pdfplus/10.1162/0034653054638382
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Publisher Info
Article provided by MIT Press in its journal Review of Economics and Statistics.

Volume (Year): 87 (2005)
Issue (Month): 3 (06)
Pages: 539-555
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Handle: RePEc:tpr:restat:v:87:y:2005:i:3:p:539-555

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  1. James Banks & Mike Brewer, 2002. "Understanding the relative generosity of government financial support for families with children," IFS Working Papers W02/02, Institute for Fiscal Studies. [Downloadable!]
  2. Michael Baker & Jonathan Gruber & Kevin Milligan, 2005. "Universal Childcare, Maternal Labor Supply, and Family Well-Being," NBER Working Papers 11832, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  3. Edith Duclos & Pierre Lefebvre & Philip Merrigan, 2001. "A 'Natural Experiment' on the Economics of Storks: Evidence on the Impact of Differential Family Policy on Fertility Rates in Canada," Cahiers de recherche CREFE / CREFE Working Papers 136, CREFE, Université du Québec à Montréal. [Downloadable!]
  4. Laroque, Guy & Salanié, Bernard, 2008. "Does Fertility Respond to Financial Incentives?," IZA Discussion Papers 3575, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  5. Daniel Parent & Christopher Worswick, 2004. "Qualifications et immigration : réforme de la grille d'admission du Québec et composition de la population d'immigrants s'établissant au Québec," CIRANO Project Reports 2004rp-08, CIRANO. [Downloadable!]
  6. Guy Stecklov & Paul Winters & Jessica Todd & Ferdinando Regalia, 2006. "Demographic Externalities from Poverty Programs in Developing Countries: Experimental Evidence from Latin America," Working Papers 2006-01, American University, Department of Economics. [Downloadable!]
  7. Lemieux, Thomas & Milligan, Kevin, 2006. "Incentive Effects of Social Assistance: A Regression Discontinuity Approach," Analytical Studies Branch Research Paper Series 2006280e, Statistics Canada, Analytical Studies Branch. [Downloadable!]
    Other versions:
  8. Stacy Dickert-Conlin & Cristian Meghea, 2004. "The Effect Of Social Security On Divorce And Remarriage Behavior," Working Papers, Center for Retirement Research at Boston College 2004-09, Center for Retirement Research. [Downloadable!]
  9. Daniel Parent, 2004. "Fécondité et incitatifs fiscaux : quelles conclusions pouvons-nous en tirer?," CIRANO Project Reports 2004rp-06, CIRANO. [Downloadable!]
  10. Daniel Parent & Ling Wang, 2002. "Tax Incentives and Fertility in Canada: Permanent vs. Transitory Effects," CIRANO Working Papers 2002s-29, CIRANO. [Downloadable!]
  11. Ohinata, Asako, 2008. "Fertility Response to Financial Incentives-Evidence from the Working Families Tax Credit in the UK," The Warwick Economics Research Paper Series (TWERPS) 851, University of Warwick, Department of Economics. [Downloadable!]
  12. Anindya Sen, 2007. "Does Increased Abortion Lead to Lower Crime? Evaluating the Relationship between Crime, Abortion, and Fertility," Topics in Economic Analysis & Policy, Berkeley Electronic Press, vol. 7(1), pages 1537-1537. [Downloadable!] (restricted)
  13. Rafael Lalive & Josef Zweimüller, . "Does Parental Leave Affect Fertility and Return-to-Work? Evidence from a ”True Natural Experiment”," IEW - Working Papers iewwp242, Institute for Empirical Research in Economics - IEW. [Downloadable!]
    Other versions:
  14. Laroque, Guy & Salanié, Bernard, 2003. "Fertility and Financial Incentives in France," CEPR Discussion Papers 4064, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  15. Kevin Milligan & Mark Stabile, 2004. "The Integration of Child Tax Credits and Welfare: Evidence from the National Child Benefit Program," NBER Working Papers 10968, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  16. Bruce Sacerdote & James Feyrer, 2008. "Will the Stork Return to Europe and Japan? Understanding Fertility Within Developed Nations," NBER Working Papers 14114, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  17. Joshua S. Gans & Andrew Leigh, 2006. "Born on the First of July: An (Un)natural Experiment in Birth Timing," CEPR Discussion Papers 529, Centre for Economic Policy Research, Research School of Social Sciences, Australian National University. [Downloadable!]
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