Can Countries Reverse Fertility Decline? Evidence from France's Marriage and Baby Bonuses, 1929–1981

International Tax and Public Finance, Vol. 18(3), p. 253-272, 2011

Posted: 5 Jun 2017

See all articles by Daniel L. Chen

Daniel L. Chen

Directeur de Recherche, Centre National de la Recherche Scientifique, Toulouse School of Economics, Institute for Advanced Study in Toulouse, University of Toulouse Capitole, Toulouse, France

Date Written: 2010

Abstract

A number of countries have begun implementing tax incentives designed to reverse the decline in fertility. Whether such incentives are effective or equitable remains an open question. During the early twentieth century, France initiated an unusual tax policy to promote fertility and marriage: Household income was divided by family size to obtain a final tax bracket. The policy was regressive in that fertility incentives were so large and greatest among the rich. Similar policies whose fertility benefit increases with income are being implemented today. Using hand-collected archival data from aggregate tax returns and three natural experiments, I find mixed evidence that these kinds of tax incentives affect fertility and marriage.

Keywords: Fertility, Tax Policy, Natural Experiment, Regressive Tax

JEL Classification: J13, J11, H20, H31

Suggested Citation

Chen, Daniel L., Can Countries Reverse Fertility Decline? Evidence from France's Marriage and Baby Bonuses, 1929–1981 (2010). International Tax and Public Finance, Vol. 18(3), p. 253-272, 2011. Available at SSRN: https://ssrn.com/abstract=2975797

Daniel L. Chen (Contact Author)

Directeur de Recherche, Centre National de la Recherche Scientifique, Toulouse School of Economics, Institute for Advanced Study in Toulouse, University of Toulouse Capitole, Toulouse, France ( email )

21 allée de Brienne
31015 Toulouse cedex 6 France
Toulouse, 31015
France

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