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How Did the Canada Child Benefit Affect Household Spending?

Author

Listed:
  • Paniz Najjarrezaparast
  • Krishna Pendakur

Abstract

We assess how the July 2016 increase in the Canada Child Benefit (CCB) affected household spending with respect to total current expenditure and its seven constituent categories: clothing, food, health care, household operations, recreation, shelter, and transportation. The increase in the CCB was large: for most recipient households, it increased by more than $2,000 per child per year. We consider households below the median income level and find statistically significant effects of the policy change only for spending on clothing, food, and shelter and only for rental-tenure households. We find that rental-tenure households with children that fell below the median income level increased their annual expenditure by about $3,400 in response to the CCB increase. Spending on food increased by roughly $700; spending on shelter, by nearly $1,400. Spending on clothing increased by roughly $350, but spending mainly increased on children’s clothing, not on adults’ clothing.

Suggested Citation

  • Paniz Najjarrezaparast & Krishna Pendakur, 2021. "How Did the Canada Child Benefit Affect Household Spending?," Canadian Public Policy, University of Toronto Press, vol. 47(4), pages 479-496, December.
    • Handle: RePEc:cpp:issued:v:47:y:2021:i:4:p:479-496
    DOI: 10.3138/cpp.2020-137
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    Cited by:

    1. Shirleen Manzur & Krishna Pendakur, 2023. "Labeling vs Targeting: How did the Canada Child Benefit affect household bargaining and preferences?," Discussion Papers dp23-01, Department of Economics, Simon Fraser University.
    2. Geranda Notten & Fatima Tuz Zohora & Charles Plante & Rachel Laforest, 2022. "Two decades of poverty reduction politics in Canada:Better for single parent families and single working age adults?," Working Papers 2203E Classification-I31,, University of Ottawa, Department of Economics.

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