Can a cash transfer to families change fertility behaviour?

by Synøve Andersen, Nina Drange, Trude Lappegård
Demographic Research, Vol. 38, Article 33, pp. 897,928 – Published 8 March 2018

34 pp. 957 kB
https://www.demographic-research.org/volumes/vol38/33/38-33.pdf

This paper assesses the much-disputed relationship between family policy and fertility, and cash transfers and fertility in particular. The authors take advantage of a cash-for-care (CFC) policy introduced in Norway in 1998, and compare the subsequent fertility behaviour of eligible and ineligible mothers over a four-year period. The paper demonstrates how policy changes may be associated with changes in fertility behaviour, and that this association may run in theoretically unexpected directions when a given policy is implemented in a wider policy framework. Moreover, it demonstrates how eligible parents may differ in their response to policies depending on the policy’s income effect and the parents’ opportunity costs of childbearing.

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