Financial Incentives and Fertility

Alma Cohen, Rajeev Dehejia and Dmitri Romanov
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Dmitri Romanov: Central Bureau of Statistics, Israel

The Review of Economics and Statistics, 2013, vol. 95, issue 1, 1-20

Abstract: Using panel data on over 300,000 Israeli women from 1999 to 2005, we exploit variation in Israel's child subsidy to identify the impact of changes in the price of a marginal child on fertility. We find a positive, statistically significant, and economically meaningful price effect on overall fertility and, consistent with Becker (1960) and Becker and Tomes (1976), a small effect of income on fertility, which is negative at low and positive at high income levels. We also find a price effect on fertility among older women, suggesting that part of the overall effect is due to a reduction in total fertility. © 2013 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Keywords: fertility; child subsidies; child allowances (search for similar items in EconPapers)
JEL-codes: D1 H31 I38 J13 K36 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (128)

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