Can We Afford a Child? The Positive Effect of His and Her Income on First Births—Evidence from Longitudinal Tax Data, 2003-2021

Carlos J. Gil-Hernández (), Daniele Vignoli (), Raffaele Guetto (), Marialuisa Maitino () and Letizia Ravagli ()
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Carlos J. Gil-Hernández: Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti", Universita' di Firenze, https://cercachi.unifi.it/p-doc2-0-0-A-3f2c3731332e2e.html
Daniele Vignoli: Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti", Universita' di Firenze, https://danielevignoli.com/
Marialuisa Maitino: Istituto Regionale per la Programmazione Economica della Toscana (IRPET), https://www.irpet.it/staff/maitino-maria-luisa/
Letizia Ravagli: Istituto Regionale per la Programmazione Economica della Toscana (IRPET), https://www.irpet.it/staff/ravagli-letizia/

No 2025_03, Econometrics Working Papers Archive from Universita' degli Studi di Firenze, Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti"

Abstract: This study adopts a dyadic approach to assess whether higher-income women experience lower fertility due to opportunity costs and conventional gender norms, or whether income pooling within couples facilitates parenthood. We test the well-established gendered relationship between income and fertility in Italy, a country historically known for its division of family roles along traditional gender lines. Utilising longitudinal tax data (2003–2021; n=5,384,425 person-years) from Tuscany—an Italian region representing average levels of economic development and gender equality in Europe—we apply discrete-time event-history analyses. Results show that higher earnings for both men and women increase the likelihood of first birth, with couples in which both partners are high earners being the most likely to have children and low-income couples the least likely. These findings challenge traditional sex-specialisation models and support the view that couples’ income pooling is a key factor for parenthood. While the positive income-fertility association remained stable for married couples, it grew stronger among single/cohabiting individuals as of the late 2010s, suggesting that rising economic prerequisites to parenthood contribute to growing income inequality in fertility.

Keywords: Fertility; Assortative Mating; Income; Tax Data; Inequality; Couples; Italy; Tuscany (search for similar items in EconPapers)
JEL-codes: D13 J12 J13 J16 J22 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2025-05
New Economics Papers: this item is included in nep-lab
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