Subsidizing the Stork: New Evidence on Tax Incentives and Fertility

Kevin Milligan

The Review of Economics and Statistics, 2005, vol. 87, issue 3, 539-555

Abstract: This paper exploits the introduction of a pronatalist transfer policy in the Canadian province of Quebec that paid up to C$8,000 to families having a child. I implement a quasi-experimental strategy by forming treatment and control groups defined by time, jurisdiction, and family type. The incentive was available broadly, rather than to a narrow population as studied in previous work, providing an exceptional opportunity to investigate heterogeneous responses. I find a strong effect of the policy on fertility, and some evidence of a heterogeneous response that may help reconcile these results with previous estimates. 2005 President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Date: 2005
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Working Paper: Subsidizing the Stork: New Evidence on Tax Incentives and Fertility (2002)
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