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Tax incentives and fertility in Canada: quantum vs tempo effects

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  • Daniel Parent
  • Ling Wang

Abstract

Using inter-jurisdictional differences in the implementation of the Family Allowance Program in Canada in the mid-1970s, this paper first shows that Quebec families with two or more children prior to being exposed to the program responded quite strongly to the added incentives in the short run relative to women in other Canadian provinces. Tracking down the cohorts across Censuses, we find that the same group of Quebec families subsequently showed a decrease in fertility relative to the rest of Canada, leaving ultimate family size unaffected. These results are consistent with the program having generated only a timing effect.

Suggested Citation

  • Daniel Parent & Ling Wang, 2007. "Tax incentives and fertility in Canada: quantum vs tempo effects," Canadian Journal of Economics, Canadian Economics Association, vol. 40(2), pages 371-400, May.
    • Handle: RePEc:cje:issued:v:40:y:2007:i:2:p:371-400
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    6. Rannveig Kaldager Hart & Taryn A. Galloway, 2023. "Universal Transfers, Tax Breaks and Fertility: Evidence from a Regional Reform in Norway," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 42(3), pages 1-32, June.
    7. Richard Crump & Gopi Shah Goda & Kevin J. Mumford, 2011. "Fertility and the Personal Exemption: Comment," American Economic Review, American Economic Association, vol. 101(4), pages 1616-1628, June.
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    12. Naidoo, Jesse, 2023. "Fertility subsidies can have ambiguous effects on birth timing," Economics Letters, Elsevier, vol. 229(C).
    13. Naidoo, Jesse, 2022. "Marginal Incentives for Birth Spacing," OSF Preprints q9t7u, Center for Open Science.
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    More about this item

    JEL classification:

    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth

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