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Evaluating how child allowances and daycare subsidies affect fertility

Author

Listed:
  • Goldstein, Joshua R.
  • Koulovatianos, Christos
  • Li, Jian
  • Schröder, Carsten

Abstract

We compare the cost effectiveness of two pronatalist policies: (a) child allowances; and (b) daycare subsidies. We pay special attention to estimating how intended fertility (fertility before children are born) responds to these policies. We use two evaluation tools: (i) a dynamic model on fertility, labor supply, outsourced childcare time, parental time, asset accumulation and consumption; and (ii) randomized vignette-survey policy experiments. We implement both tools in the United States and Germany, finding consistent evidence that daycare subsidies are more cost effective. Nevertheless, the required public expenditure to increase fertility to the replacement level might be viewed as prohibitively high.

Suggested Citation

  • Goldstein, Joshua R. & Koulovatianos, Christos & Li, Jian & Schröder, Carsten, 2017. "Evaluating how child allowances and daycare subsidies affect fertility," CFS Working Paper Series 568, Center for Financial Studies (CFS).
    • Handle: RePEc:zbw:cfswop:568
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    File URL: https://www.econstor.eu/bitstream/10419/155334/1/880726970.pdf
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    Citations

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    Cited by:

    1. Beckmannshagen, Mattis & Schröder, Carsten, 2022. "Earnings inequality and working hours mismatch," Labour Economics, Elsevier, vol. 76(C).
    2. 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.
    3. Kamila Ishchanova, 2022. "Home Alone: Exploring Childcare Options to Remove Barriers to Second Childbearing in Belarus," Social Inclusion, Cogitatio Press, vol. 10(3), pages 112-123.

    More about this item

    Keywords

    childcare; fertility; labor supply; vignette survey method; public policy;
    All these keywords.

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • C83 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Survey Methods; Sampling Methods
    • D10 - Microeconomics - - Household Behavior - - - General
    • C38 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Classification Methdos; Cluster Analysis; Principal Components; Factor Analysis

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