Desired fertility, realized fertility and the effects of China's Universal Two-Child Policy∗

We argue that women's desired fertility has become the binding constraint in low-fertility contexts: once fertility desires fall below policy ceilings, removing quotas alone cannot generate a substantial rebound. We test this hypothesis using China's Universal Two-Child (UTC) policy adopted in January 2016, an abrupt nationwide relaxation following decades of the One-Child Policy (OCP). Drawing on nationally representative data from the 2017 China Fertility Survey and exploiting eligibility variation created by the UTC policy, we find that the policy increased births by only 0.023 per eligible woman in 2016–2017, driven almost exclusively by women who desired two or more children. County-level evidence from the 2020 population census data further shows that fertility in 2016–2020 rose primarily in places with higher average desired fertility. These results indicate that declining fertility desires—not administrative birth quotas—now constrain fertility in post-OCP China.