The costs of raising children and the effectiveness of policies to support parenthood in European countries: a Literature Review

The purpose of this report is to produce an overview of available knowledge about the following issues: the costs (to parents) of parenthood and of raising children in European Countries; the effectiveness, in the short and long term, of various policy measures in avoiding or compensating for those costs; 8 the impact of different policy instruments aimed at supporting families according to various policy objectives, e.g. achieving family projects, reconciling family and working life, reducing child poverty, raising the levels of education and well being of children, and increasing equal opportunities. the wider economic and social costs and benefits of policy interventions in support of families. The current state of knowledge on the following issues is presented as follows in this review report: The costs of children and the challenges for public policies supporting parenthood (chapter 1); author: O. Thévenon The policy instruments used in the EU to support families and reduce the costs of parenthood (Chapter 2); authors: A. Math and O. Thévenon The impacts of these policies on families: o On fertility and the decision to have children (chapter 3); authors M-Th. Letablier and O. Thévenon o On parents‘ participation in the labour market, gender equality and work-life balance (chapter 4); authors: M-Th. Letablier, A. Luci, O. Thévenon o On children‘s well-being (chapter 5): M-Th. Letablier and O. Thévenon The wider economic and social costs and benefits of such policies (Chapter 6); author: A. Luci. The review of literature presented in this report attempts to make the tools, goals and impacts of family policies more clear and comparable across countries, in order to facilitate the circulation of knowledge between Member States, notably in the context of the European Alliance for Families and the newly established High Level Experts Group on Demography Issues. The report provides a review of recent literature and available data material on the direct and indirect costs of raising children in the European Union (using international as well as particularly important national studies). Ground breaking studies from countries outside the EU, of particular interest from a methodological point of view, are also included in the review. Focus is on the following kinds of costs of having and raising children over the long and short term: - Direct financial costs, e.g. for housing, health care, education, child care, - Indirect financial costs, e.g. for lost income, lost pension rights, lost career prospects etc. , also taking into account the impact on gender roles and gender equality. The costs of raising children are examined at the different phases of their development, from birth through to the age at which they become autonomous. The overview also summarizes knowledge on the main determinants of costs, including, the effects of the number of children, the socio-economic status of parents, and the family structure. Significant differences in cost levels and structures across Member States are identified. The overview also identifies gaps in the available knowledge, and highlights some issues for future research that have the potential to contribute to a better understanding of the policy impact and to better comparability across the European Union.