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The effect of child benefit on female labor supply

Author

Listed:
  • Magda Iga

    (Institute for Structural Research (IBS), Warsaw, Poland)

  • Kiełczewska Aneta

    (Institute for Structural Research (IBS), Warsaw, Poland)

  • Brandt Nicola

    (Organisation for Economic Co-operation and Development (OECD), Economic Desk, Paris, France)

Abstract

In 2016, the Polish government introduced a large child benefit, called “Family 500+”, with the aim to increase fertility and reduce child poverty. It is universal for the second and every further child and means-tested for the first child. We study the impact of the new benefit on female labor supply, using Labor Force Survey data. Based on a difference-in-differences methodology, we find that the labor market participation rates of women with children decreased after the introduction of the benefit compared to that of childless women. The labor force participation rate of mothers showed a drop of 2–3 percentage points by mid-2017 as a result of the “Family 500+” program. The effect was higher among women with lower levels of education and among women living in small towns.

Suggested Citation

  • Magda Iga & Kiełczewska Aneta & Brandt Nicola, 2020. "The effect of child benefit on female labor supply," IZA Journal of Labor Policy, Sciendo & Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 10(1), pages 1-18, March.
    • Handle: RePEc:vrs:izajlp:v:10:y:2020:i:1:p:18:n:8
    DOI: 10.2478/izajolp-2020-0017
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    References listed on IDEAS

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    Cited by:

    1. Michal Brzezinski & Katarzyna Sałach‐Dróżdż, 2024. "The short‐term macroeconomic impact of populism: A case study of Poland," Economics and Politics, Wiley Blackwell, vol. 36(2), pages 832-867, July.
    2. Michał Brzeziński & Katarzyna Sałach-Dróżdż, 2023. "Prudent populists? The short-term macroeconomic impact of populist policies in Poland," Working Papers 2023-02, Faculty of Economic Sciences, University of Warsaw.
    3. Zając, Tomasz & Magda, Iga & Bożykowski, M. & Chłoń-Domińczak, Agnieszka & Jasiński, M., 2023. "Gender Pay Gaps across STEM Fields of Study," IZA Discussion Papers 16613, Institute of Labor Economics (IZA).
    4. Emilio Congregado & Ewa Galecka-Burdziak & Antonio A. Golpe & Robert Pater, 2021. "Separating aggregate discouraged and added worker effects: the case of a former transition country," Oeconomia Copernicana, Institute of Economic Research, vol. 12(3), pages 729-760, September.
    5. Barbara Liberda & Katarzyna Sałach & Marek Pęczkowski, 2023. "The Effects of Child Benefit on Household Saving," Journal of Family and Economic Issues, Springer, vol. 44(2), pages 447-460, June.
    6. Lindahl, Erica & Rosenqvist, Olof & Selin, Håkan, 2023. "Gender-targeted transfers by default? - Evidence from a child allowance reform in Sweden," Labour Economics, Elsevier, vol. 83(C).
    7. Jan Gromadzki & Katarzyna Sałach & Michał Brzeziński, 2024. "When populists deliver on their promises: the electoral effects of a large cash transfer programme in Poland," Economica, London School of Economics and Political Science, vol. 91(361), pages 320-345, January.
    8. Jan Gromadzki, 2021. "Labor supply effects of a universal cash transfer," IBS Working Papers 02/2021, Instytut Badan Strukturalnych.
    9. Piotr Lewandowski & Iga Magda, 2023. "The labor market in Poland, 2000−2021," IZA World of Labor, Institute of Labor Economics (IZA), pages 426-426, March.

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    More about this item

    Keywords

    child allowance; social transfers; family policy; labor market participation;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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