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Completed fertility effects of family policy measures: Evidence from a life-cycle model

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  • Abiry, Raphael
  • Reuss, Karsten
  • Stichnoth, Holger

Abstract

We estimate a structural life-cycle model of fertility and female labour supply and use it to evaluate the effects of a number of key family policy measures based on data for Germany. Parental leave benefits, child benefits and subsidized childcare are found to have substantial fertility effects. Without these measures, completed fertility is estimated to be lower by 6%, 7%, and 10%, respectively. Income tax splitting, which is fiscally expensive, reduces female labour supply but has a negligible effect on fertility.

Suggested Citation

  • Abiry, Raphael & Reuss, Karsten & Stichnoth, Holger, 2014. "Completed fertility effects of family policy measures: Evidence from a life-cycle model," ZEW Discussion Papers 14-068, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:14068
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    References listed on IDEAS

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    1. Jérôme Adda & Christian Dustmann & Katrien Stevens, 2017. "The Career Costs of Children," Journal of Political Economy, University of Chicago Press, vol. 125(2), pages 293-337.
    2. Richard Blundell & Monica Costa Dias & Costas Meghir & Jonathan Shaw, 2016. "Female Labor Supply, Human Capital, and Welfare Reform," Econometrica, Econometric Society, vol. 84, pages 1705-1753, September.
    3. Orazio Attanasio & Hamish Low & Virginia Sánchez-Marcos, 2008. "Explaining Changes in Female Labor Supply in a Life-Cycle Model," American Economic Review, American Economic Association, vol. 98(4), pages 1517-1552, September.
    4. Marco Francesconi, 2002. "A Joint Dynamic Model of Fertility and Work of Married Women," Journal of Labor Economics, University of Chicago Press, vol. 20(2), pages 336-380, Part.
    5. Kamila Cygan-Rehm, 2014. "Wirkungen des Elterngeldes auf die Fertilität: zum Stand der Kenntnis," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 83(1), pages 145-162.
    6. Slonimczyk, Fabián & Yurko, Anna, 2014. "Assessing the impact of the maternity capital policy in Russia," Labour Economics, Elsevier, vol. 30(C), pages 265-281.
    7. Haan, Peter & Wrohlich, Katharina, 2011. "Can child care policy encourage employment and fertility?: Evidence from a structural model," Labour Economics, Elsevier, vol. 18(4), pages 498-512, August.
    8. Holger Stichnoth, 2020. "Short-run fertility effects of parental leave benefits: evidence from a structural model," Empirical Economics, Springer, vol. 59(1), pages 143-168, July.
    9. Gert G. Wagner & Joachim R. Frick & Jürgen Schupp, 2007. "The German Socio-Economic Panel Study (SOEP) – Scope, Evolution and Enhancements," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 127(1), pages 139-169.
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    Cited by:

    1. Lucie Kábelová & Markéta Arltová, 2020. "Účinnost rodinné politiky v České republice [Effectiveness of Family Policy in the Czech Republic]," Politická ekonomie, Prague University of Economics and Business, vol. 2020(6), pages 679-694.
    2. Holger Bonin & Karsten Reuss & Holger Stichnoth, 2016. "The Monetary Value of Family Policy Measures in Germany over the Life Cycle: Evidence from a Dynamic Microsimulation Model," CESifo Economic Studies, CESifo Group, vol. 62(4), pages 650-671.

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    More about this item

    Keywords

    Fertility; female labour supply; family policy; dynamic programming;
    All these keywords.

    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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