Baby Bonus, Anyone? Examining Heterogeneous Responses to a Pro-Natalist Policy

55 Pages Posted: 4 Oct 2016 Last revised: 25 Nov 2018

See all articles by Natalie Malak

Natalie Malak

McMaster University

Md Mahbubur Rahman

McMaster University

Terry Yip

McMaster University

Date Written: November 22, 2018

Abstract

We examine the impact of the Allowance for Newborn Children, a universal baby bonus offered by the Canadian province of Quebec, on birth order, sibship sex composition, income, and education. We find a large response for third and higher-order births for which the bonus was more generous. Interestingly, though, we find stronger response if there were two previous sons or a previous son and daughter rather than two previous daughters. We also find, in addition to a transitory effect, a permanent effect, with the greatest increase in one daughter-two son families among three-child households. Moreover, we find a hump shape response by income group, with the greatest response from middle-income families. Also, women with at least some post-secondary education respond more to the policy than those with less. These findings suggest that properly structured pro-natal policies can successfully increase fertility among different segments of the population while simultaneously diminishing the effect of gender preferences and fertility disparity related to women‟s education.

Keywords: Fertility; Family Policy; Reform

JEL Classification: J13, H31

Suggested Citation

Malak, Natalie and Rahman, Md Mahbubur and Yip, Terry, Baby Bonus, Anyone? Examining Heterogeneous Responses to a Pro-Natalist Policy (November 22, 2018). Available at SSRN: https://ssrn.com/abstract=2846802 or http://dx.doi.org/10.2139/ssrn.2846802

Natalie Malak

McMaster University ( email )

1280 Main Street West
Hamilton, Ontario L8S 4M4
Canada

Md Mahbubur Rahman

McMaster University ( email )

1280 Main Street West
Hamilton, Ontario L8S 4M4
Canada

Terry Yip (Contact Author)

McMaster University ( email )

1280 Main Street West
Hamilton, Ontario L8S 4M4
Canada

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