IDEAS home Printed from https://ideas.repec.org/p/ewp/wpaper/481web.html
   My bibliography  Save this paper

Financial Incentives to Fertility: From Short to Long Run

Author

Listed:
  • F. Javier Rodríguez Román

    (University of Barcelona, BEAT)

  • Lidia Cruces de Sousa

    (Goethe University Frankfurt)

Abstract

Are financial incentives effective in increasing fertility rates? Empirical evidence suggests they are, primarily in the short run (around implementation). Can such policies also increase the total number of children in the long run? We address this question by using a structural life-cycle model of fertility and labor supply, calibrated to replicate the short-run effects of a cash transfer paid at childbirth implemented in 2007 in Spain. The model incorporates labor market duality, a defining feature of Spanish labor markets that negatively impacts fertility. Our calibrated model replicates a 6% increase in fertility rates in the short run but only generates a 3% rise in completed fertility over women’s lifetimes—the long run. Eliminating labor market duality increases lifetime fertility by 6.62%, but the discrepancy between short- and long-run effects of the incentive persists. These results highlight the limited impact of financial incentives alone to sustain fertility gains.

Suggested Citation

  • F. Javier Rodríguez Román & Lidia Cruces de Sousa, 2025. "Financial Incentives to Fertility: From Short to Long Run," UB School of Economics Working Papers 2025/481, University of Barcelona School of Economics.
    • Handle: RePEc:ewp:wpaper:481web
    as

    Download full text from publisher

    File URL: https://hdl.handle.net/2445/219307
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ewp:wpaper:481web. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: University of Barcelona School of Economics (email available below). General contact details of provider: https://edirc.repec.org/data/feubaes.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.