Working Paper: NBER ID: w15984
Authors: Richard Crump; Gopi Shah Goda; Kevin Mumford
Abstract: One of the most commonly cited studies on the effect of child subsidies on fertility, Whittington, Alm and Peters (1990), claimed a large positive effect of child tax benefits on fertility using time series methods. We revisit this question in light of recent increases in child tax benefits by replicating this earlier study and extending the analysis. We do not find strong evidence to justify the model specification from the original paper. Moreover, even if the original specfication is appropriate, we show that the Whittington et al. results are not robust to more general measures of child tax benefits. While we do not find evidence that child tax benefits affect the level of fertility, we find some evidence of a short-run fertility response that occurs with a two-year lag.
Keywords: Fertility; Child Tax Benefits; Tax Policy
JEL Codes: C22; H2; J13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Child tax benefits (H20) | Fertility rates (J13) |
| $100 increase in child tax benefits (J13) | Increase in fertility rates (J13) |
| Child tax benefits (H20) | Timing of fertility decisions (J13) |
| Child tax benefits (H20) | Overall level of fertility (J13) |
| Short-run fertility response with a two-year lag (J19) | Timing of fertility (C41) |
| $100 increase in child tax benefits (J13) | Total short-run effect on fertility (J13) |