IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/26712.html
   My bibliography  Save this paper

Economic Incentives Surrounding Fertility: Evidence from Alaska's Permanent Fund Dividend

Author

Listed:
  • Nishant Yonzan
  • Laxman Timilsina
  • Inas Rashad Kelly

Abstract

Starting in 1982, the Alaska Permanent Fund Dividend allows each full-time resident in Alaska, including infants born in the qualifying year, to receive a sizable dividend. This dividend, which represents a form of a Universal Basic Income on a small scale, could alter incentives surrounding fertility. Using synthetic control and difference-in-differences models to account for confounding factors and unobserved heterogeneity, we model the effect of income on fertility by exploiting this income shock around 1982 using Natality files from Vital Statistics and abortion data from the Centers for Disease Control, merged with data from the Census on various state characteristics. Primary results suggest that the dividend increased fertility and reduced the spacing between births, particularly for females in the 20-44 year age group. Our results suggest that policies aimed at increasing income should consider fertility consequences and their implications for economic growth.

Suggested Citation

  • Nishant Yonzan & Laxman Timilsina & Inas Rashad Kelly, 2020. "Economic Incentives Surrounding Fertility: Evidence from Alaska's Permanent Fund Dividend," NBER Working Papers 26712, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:26712
    Note: EH PE
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w26712.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Keane, Michael & Moffitt, Robert, 1998. "A Structural Model of Multiple Welfare Program Participation and Labor Supply," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 39(3), pages 553-589, August.
    2. Nikolay Doudchenko & Guido W. Imbens, 2016. "Balancing, Regression, Difference-In-Differences and Synthetic Control Methods: A Synthesis," NBER Working Papers 22791, National Bureau of Economic Research, Inc.
    3. David K. Evans & Anna Popova, 2017. "Cash Transfers and Temptation Goods," Economic Development and Cultural Change, University of Chicago Press, vol. 65(2), pages 189-221.
    4. Creina Day, 2016. "Fertility and economic growth: the role of workforce skill composition and child care prices," Oxford Economic Papers, Oxford University Press, vol. 68(2), pages 546-565.
    5. Hilary W. Hoynes & Jesse Rothstein, 2019. "Universal Basic Income in the US and Advanced Countries," NBER Working Papers 25538, National Bureau of Economic Research, Inc.
    6. Alma Cohen & Rajeev Dehejia & Dmitri Romanov, 2013. "Financial Incentives and Fertility," The Review of Economics and Statistics, MIT Press, vol. 95(1), pages 1-20, March.
    7. Hamish Low & Costas Meghir & Luigi Pistaferri & Alessandra Voena, 2018. "Marriage, Labor Supply and the Dynamics of the Social Safety Net," NBER Working Papers 24356, National Bureau of Economic Research, Inc.
    8. Damon Jones & Ioana Marinescu, 2022. "The Labor Market Impacts of Universal and Permanent Cash Transfers: Evidence from the Alaska Permanent Fund," American Economic Journal: Economic Policy, American Economic Association, vol. 14(2), pages 315-340, May.
    9. Gary S. Becker & Robert J. Barro, 1988. "A Reformulation of the Economic Theory of Fertility," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 103(1), pages 1-25.
    10. Abhijit Banerjee & Paul Niehaus & Tavneet Suri, 2019. "Universal Basic Income in the Developing World," Annual Review of Economics, Annual Reviews, vol. 11(1), pages 959-983, August.
    11. Maitreesh Ghatak & François Maniquet, 2019. "Universal Basic Income: Some Theoretical Aspects," Annual Review of Economics, Annual Reviews, vol. 11(1), pages 895-928, August.
    12. Julia Tanndal & Daniel Waldenström, 2018. "Does Financial Deregulation Boost Top Incomes? Evidence from the Big Bang," Economica, London School of Economics and Political Science, vol. 85(338), pages 232-265, April.
    13. Abadie, Alberto & Diamond, Alexis & Hainmueller, Jens, 2010. "Synthetic Control Methods for Comparative Case Studies: Estimating the Effect of California’s Tobacco Control Program," Journal of the American Statistical Association, American Statistical Association, vol. 105(490), pages 493-505.
    14. Kevin Milligan, 2005. "Subsidizing the Stork: New Evidence on Tax Incentives and Fertility," The Review of Economics and Statistics, MIT Press, vol. 87(3), pages 539-555, August.
    15. Gary S. Becker, 1981. "A Treatise on the Family," NBER Books, National Bureau of Economic Research, Inc, number beck81-1, June.
    16. Alberto Abadie & Alexis Diamond & Jens Hainmueller, 2015. "Comparative Politics and the Synthetic Control Method," American Journal of Political Science, John Wiley & Sons, vol. 59(2), pages 495-510, February.
    17. Sebastian Galiani & Brian Quistorff, 2017. "The synth runner package: Utilities to automate synthetic control estimation using synth," Stata Journal, StataCorp LP, vol. 17(4), pages 834-849, December.
    18. Ioana Marinescu, 2018. "No Strings Attached: The Behavioral Effects of U.S. Unconditional Cash Transfer Programs," NBER Working Papers 24337, National Bureau of Economic Research, Inc.
    19. Reagan Baughman & Stacy Dickert-Conlin, 2009. "The earned income tax credit and fertility," Journal of Population Economics, Springer;European Society for Population Economics, vol. 22(3), pages 537-563, July.
    20. Chang-Tai Hsieh, 2003. "Do Consumers React to Anticipated Income Changes? Evidence from the Alaska Permanent Fund," American Economic Review, American Economic Association, vol. 93(1), pages 397-405, March.
    21. Berman, Matthew, 2018. "Resource rents, universal basic income, and poverty among Alaska’s Indigenous peoples," World Development, Elsevier, vol. 106(C), pages 161-172.
    22. Abhijit V. Banerjee & Rema Hanna & Gabriel E. Kreindler & Benjamin A. Olken, 2017. "Debunking the Stereotype of the Lazy Welfare Recipient: Evidence from Cash Transfer Programs," The World Bank Research Observer, World Bank, vol. 32(2), pages 155-184.
    23. Scott Goldsmith, 2012. "The Economic and Social Impacts of the Permanent Fund Dividend on Alaska," Exploring the Basic Income Guarantee, in: Karl Widerquist & Michael W. Howard (ed.), Alaska’s Permanent Fund Dividend, chapter 0, pages 49-63, Palgrave Macmillan.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Anna Bokun, 2024. "Cash transfers and fertility: Evidence from Poland’s Family 500+ Policy," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 51(28), pages 855-910.
    2. Singh, Parvati & Gemmill, Alison & Bruckner, Tim-Allen, 2023. "Casino-based cash transfers and fertility among the Eastern Band of Cherokee Indians in North Carolina: A time-series analysis," Economics & Human Biology, Elsevier, vol. 51(C).
    3. Jennifer Glass & Carolyn E. Waldrep, 2023. "Child Allowances and Work-Family Reconciliation Policies: What Best Reduces Child Poverty and Gender Inequality While Enabling Desired Fertility?," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 42(5), pages 1-57, October.
    4. Day, Creina, 2022. "Increasing inequality and voting for basic income: Could gender inequality worsen?," Economic Analysis and Policy, Elsevier, vol. 76(C), pages 476-487.
    5. Rannveig Kaldager Hart & Janna Bergsvik & Agnes Fauske & Wookun Kim, 2023. "Causal Analysis of Policy Effects on Fertility," CESifo Working Paper Series 10690, CESifo.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yonzan, Nishant & Timilsina, Laxman & Kelly, Inas Rashad, 2024. "Economic incentives surrounding fertility: Evidence from Alaska’s permanent fund dividend," Economics & Human Biology, Elsevier, vol. 52(C).
    2. Manuela A. de Paz-Báñez & María José Asensio-Coto & Celia Sánchez-López & María-Teresa Aceytuno, 2020. "Is There Empirical Evidence on How the Implementation of a Universal Basic Income (UBI) Affects Labour Supply? A Systematic Review," Sustainability, MDPI, vol. 12(22), pages 1-36, November.
    3. Damon Jones & Ioana Marinescu, 2022. "The Labor Market Impacts of Universal and Permanent Cash Transfers: Evidence from the Alaska Permanent Fund," American Economic Journal: Economic Policy, American Economic Association, vol. 14(2), pages 315-340, May.
    4. Guettabi, Mouhcine & Witman, Allison, 2023. "Universal cash transfers and prescription utilization: Evidence from the Alaska permanent fund dividend," Journal of Health Economics, Elsevier, vol. 90(C).
    5. Richard Dorsett, 2021. "A Bayesian structural time series analysis of the effect of basic income on crime: Evidence from the Alaska Permanent Fund," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 184(1), pages 179-200, January.
    6. Robert M. Feinberg & Daniel Kuehn, 2020. "Does a Guaranteed Basic Income Encourage Entrepreneurship? Evidence from Alaska," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 57(3), pages 607-626, November.
    7. Giupponi, Giulia, 2019. "When income effects are large: labor supply responses and the value of welfare transfers," LSE Research Online Documents on Economics 103424, London School of Economics and Political Science, LSE Library.
    8. Natalie Malak & Md Mahbubur Rahman & Terry A. Yip, 2019. "Baby bonus, anyone? Examining heterogeneous responses to a pro-natalist policy," Journal of Population Economics, Springer;European Society for Population Economics, vol. 32(4), pages 1205-1246, October.
    9. Gubello, Michele, 2024. "Social trust and the support for universal basic income," European Journal of Political Economy, Elsevier, vol. 81(C).
    10. Billy, Alexander & Packard, Michael, 2022. "Crime and the Mariel Boatlift," International Review of Law and Economics, Elsevier, vol. 72(C).
    11. Diego Daruich & Raquel Fernández, 2024. "Universal Basic Income: A Dynamic Assessment," American Economic Review, American Economic Association, vol. 114(1), pages 38-88, January.
    12. Giulia Giupponi, 2019. "When income effects are large: labor supply responses and the value of welfare transfers," CEP Discussion Papers dp1651, Centre for Economic Performance, LSE.
    13. Daniel Albalate & Germà Bel & Ferran A. Mazaira-Font, 2020. "Ensuring Stability, Accuracy and Meaningfulness in Synthetic Control Methods: The Regularized SHAP-Distance Method," IREA Working Papers 202005, University of Barcelona, Research Institute of Applied Economics, revised Apr 2020.
    14. Bruno Ferman & Cristine Pinto & Vitor Possebom, 2020. "Cherry Picking with Synthetic Controls," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 39(2), pages 510-532, March.
    15. Maximiliano Marzetti & Rok Spruk, 2023. "Long-Term Economic Effects of Populist Legal Reforms: Evidence from Argentina," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 65(1), pages 60-95, March.
    16. Davide Viviano & Jelena Bradic, 2019. "Synthetic learner: model-free inference on treatments over time," Papers 1904.01490, arXiv.org, revised Aug 2022.
    17. Niklas Potrafke & Fabian Ruthardt & Kaspar Wuthrich, 2020. "Protectionism and economic growth: Causal evidence from the first era of globalization," Papers 2010.02378, arXiv.org, revised Mar 2022.
    18. Seung‐hun Chung & Jung Bae, 2022. "Does refugee inflow affect urban crime? Evidence from the U.S. Indochinese refugee resettlement," Southern Economic Journal, John Wiley & Sons, vol. 88(3), pages 951-990, January.
    19. Sviták, Jan & Tichem, Jan & Haasbeek, Stefan, 2021. "Price effects of search advertising restrictions," International Journal of Industrial Organization, Elsevier, vol. 77(C).
    20. Xiong, Ruoxuan & Pelger, Markus, 2023. "Large dimensional latent factor modeling with missing observations and applications to causal inference," Journal of Econometrics, Elsevier, vol. 233(1), pages 271-301.

    More about this item

    JEL classification:

    • H7 - Public Economics - - State and Local Government; Intergovernmental Relations
    • I1 - Health, Education, and Welfare - - Health

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:26712. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.