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The Fertility-Sex Ratio Trade-off: Unintended Consequences of Financial Incentives

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  • Anukriti, S

    () (Boston College)

Abstract

Lower fertility can translate into a more male-biased sex ratio if son preference is persistent and technology for sex-selection is easily accessible. This paper investigates whether financial incentives can overcome this trade-off in the context of an Indian scheme, Devirupak, that seeks to decrease both fertility and the sex ratio at birth. First, I construct a model where the effects of incentives are determined by the strength of son preference, the cost of children, and the cost of sex-selection, relative to the size of incentives. Second, I create a woman-year panel dataset from retrospective birth histories and use variation in the composition of pre-existing children as well as the state and the year of program implementation to estimate its causal effect. Devirupak successfully lowers the number of children by 1 percent, but mainly through a 2 percent decrease in the number of daughters. Faced with a choice between a son and only daughters, couples choose a son despite lower monetary benefits, and thus the sex ratio at birth unintentionally increases. A subsidy worth 10 months of average household consumption expenditure is insufficient to induce parents to give up sons entirely. Instead, Devirupak increases the proportion of one-boy couples by 5 percent. The proportion of one-girl couples increases only among the lowest socioeconomic status groups.

Suggested Citation

  • Anukriti, S, 2014. "The Fertility-Sex Ratio Trade-off: Unintended Consequences of Financial Incentives," IZA Discussion Papers 8044, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp8044
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    Cited by:

    1. repec:taf:oxdevs:v:45:y:2017:i:4:p:479-498 is not listed on IDEAS
    2. Seema Jayachandran, 2017. "Fertility Decline and Missing Women," American Economic Journal: Applied Economics, American Economic Association, vol. 9(1), pages 118-139, January.
    3. Samuel Marden, 2016. "Family Size and the Demand for Sex Selection: Evidence From China," Working Paper Series 9016, Department of Economics, University of Sussex.
    4. Samuel Marden, 2016. "Family Size and the Demand for Sex Selection: Evidence From China," Working Paper Series 09016, Department of Economics, University of Sussex.
    5. Scott Fulford, 2013. "The changing geography of gender in India," Boston College Working Papers in Economics 833, Boston College Department of Economics.
    6. Mishra, Khushbu & Sam, Abdoul G., 2016. "Does Women’s Land Ownership Promote Their Empowerment? Empirical Evidence from Nepal," World Development, Elsevier, vol. 78(C), pages 360-371.
    7. Anukriti, S & Kumler, Todd J., 2014. "Tariffs, Social Status, and Gender in India," IZA Discussion Papers 7969, Institute for the Study of Labor (IZA).
    8. Anukriti, S & Chakravarty, Abhishek, 2015. "Political Aspirations in India: Evidence from Fertility Limits on Local Leaders," IZA Discussion Papers 9023, Institute for the Study of Labor (IZA).

    More about this item

    Keywords

    sex ratio; fertility; India; Haryana; financial incentives;

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development

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