Does Welfare Reform Affect Fertility? Evidence from the UK

Mike Brewer, Anita Ratcliffe and Sarah Smith

The Centre for Market and Public Organisation from The Centre for Market and Public Organisation, University of Bristol, UK

Abstract: This paper presents evidence on the fertility effect of welfare from a set of reforms that took place in the UK in 1999 and that substantially increased support for poorer families with children. The reforms, including the introduction of the Working Families Tax Credit and an increase in means-tested income support, raised benefits by up to 10 per cent of household income. We exploit the fact that the reforms were targeted on low-income households and use a differences-in-differences approach to evaluate their impact on fertility. A priori, the fertility effect of the reforms is ambiguous because WFTC has pro-employment effects. In practice, these are more important for lone mothers and we therefore focus on women in couples where we expect the reforms to have a positive effect on births. We find that the reforms raised the probability of birth among women in couples by around 10 per cent (implying an elasticity of 0.22). In line with previous work, the effect is greatest for first births.

Keywords: Welfare reform; Fertility; Working Families Tax Credit (search for similar items in EconPapers)
JEL-codes: H53 J13 J18 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2007-08
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (24)

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Related works:
Journal Article: Does welfare reform affect fertility? Evidence from the UK (2012)
Working Paper: Does welfare reform affect fertility? Evidence from the UK (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:bri:cmpowp:07/177

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