Evaluating how child allowances and daycare subsidies affect fertility

Joshua R. Goldstein, Christos Koulovatianos, Jian Li () and Carsten Schröder

No 568, CFS Working Paper Series from Center for Financial Studies (CFS)

Abstract: We compare the cost effectiveness of two pronatalist policies: (a) child allowances; and (b) daycare subsidies. We pay special attention to estimating how intended fertility (fertility before children are born) responds to these policies. We use two evaluation tools: (i) a dynamic model on fertility, labor supply, outsourced childcare time, parental time, asset accumulation and consumption; and (ii) randomized vignette-survey policy experiments. We implement both tools in the United States and Germany, finding consistent evidence that daycare subsidies are more cost effective. Nevertheless, the required public expenditure to increase fertility to the replacement level might be viewed as prohibitively high.

Keywords: childcare; fertility; labor supply; vignette survey method; public policy (search for similar items in EconPapers)
JEL-codes: C38 C83 D10 D91 J13 J18 J38 (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-dge
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:cfswop:568

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