Did Australia’s Baby Bonus Increase Fertility Intentions and Births?
Rent the article at a discountRent now
* Final gross prices may vary according to local VAT.Get Access
In May 2004, the Australian government announced a “Baby Bonus” policy, paying women an initial A$3,000 per new child. We use household panel data from the Household, Income and Labour Dynamics in Australia Survey (N = 14,932) and a simultaneous equations approach to analyze the effects of this bonus on fertility intentions and ultimately births. The results indicate that opportunity costs influence intentions and births in predictable ways. Fertility intentions rose after the announcement of the Baby Bonus, and the birth rate is estimated to have risen modestly as a result. The marginal cost to the government for an additional birth is estimated to be at least A$126,000.
- Australian Bureau of Statistics [ABS]. (2008). Consumer price index, Australia, September 2008 (ABS cat. no. 6401.0). Canberra: Australian Bureau of Statistics.
- ABS. (2009a). Births, Australia, 2008 (ABS cat. no. 3301.0). Canberra: Australian Bureau of Statistics.
- ABS. (2009b). Australian Economic Indicators, 2009 (ABS cat. no. 1350.0). Canberra: Australian Bureau of Statistics.
- ABS. (2009c). Lifetime marriage and divorce trends, 2007 (ABS cat. no. 4102.0). Canberra: Australian Bureau of Statistics.
- Australian Government Department of Families, Housing, Community Services and Indigenous Affairs (FAHCSIA). Annual Reports, 2005–06, 2006–07, 2007–08, and 2008–09. Canberra: FAHCSIA.
- Australian Office for Women. (2007). Women in Australia 2007. Canberra: Commonwealth of Australia.
- Australian Treasury. (2002). Australia’s demographic challenges. Canberra: Commonwealth of Australia.
- Becker, G. S. (1960). An economic analysis of fertility. In Demographic and economic change in developed countries: A conference of the Universities-National Bureau Committee for Economic Research, 1960 (pp. 209–240). Princeton, NJ: Princeton University Press.
- Bongaarts, J., & Feeney, G. (1998). On the quantum and tempo of fertility. Population and Development Review, 24(2), 271–291. CrossRef
- Bonoli, G. (2008). The impact of social policy on fertility: Evidence from Switzerland. Journal of European Social Policy, 18(1), 64–77. CrossRef
- Buttner, T., & Lutz, W. (1990). Estimating fertility responses to policy measures in the German Democratic Republic. Population and Development Review, 16(3), 539–555. CrossRef
- D’Addio, A. C., & Mira D’Ercole, M. (2005). Trends and determinants of fertility rates in OECD countries: The role of policies. OECD Social, Employment and Migration Working Papers, No. 27. Paris: OECD.
- Ermisch, J. (1988). The econometric analysis of birth rate dynamics in Britain. Journal of Human Resources, 23(4), 563–576. CrossRef
- Gans, J. S., & Leigh, A. (2009). Born on the first of July: An (un)natural experiment in birth timing. Journal of Public Economics, 93(1–2), 246–263. CrossRef
- Gauthier, A. H. (2007). The impact of family policies on fertility in industrialized countries: A review of the literature. Population Research and Policy Review, 26(3), 323–346. CrossRef
- Gauthier, A. H., & Hatzius, J. (1997). Family benefits and fertility: An econometric analysis. Population Studies, 51(3), 295–306. CrossRef
- Goldstein, J. R., Sobotka, T., & Jasilioniene, A. (2009). The end of “lowest-low” fertility? Population and Development Review, 35(4), 663–699. CrossRef
- Gray, M., Qu, L., & Weston, R. (2008). Fertility and family policy in Australia (AIFS research paper no. 41). Melbourne: Australian Institute of Family Studies.
- Lattimore, R., & Pobke, C. (2008). Recent trends in Australian fertility. (Productivity Commission Staff Working Paper). Canberra: Commonwealth of Australia.
- Manski, C. F., & Mayshar, J. (2003). Private incentives and social interactions: Fertility puzzles in Israel. Journal of the European Economic Association, 1(1), 181–211. CrossRef
- McDonald, P. (2006). Low fertility and the state: The efficacy of policy. Population and Development Review, 32(3), 485–510. CrossRef
- Milligan, K. (2005). Subsidizing the stork: New evidence on tax incentives and fertility. Review of Economics and Statistics, 87(3), 539–555. CrossRef
- Morgan, S. P., & Taylor, M. G. (2006). Low fertility at the turn of the twenty-first century. Annual Review of Sociology, 32, 375–399. CrossRef
- Schoen, R., Astone, N. M., Kim, Y. J., Nathanson, C. A., & Fields, J. M. (1999). Do fertility intentions affect fertility behavior? Journal of Marriage and the Family, 61(3), 790–799. CrossRef
- Watson, N. (Ed.). (2008). HILDA user manual—release 6. Melbourne: Melbourne Institute of Applied Economic and Social Research, University of Melbourne.
- Wooden, M., & Watson, N. (2007). The HILDA Survey and its contribution to economic and social research (so far). The Economic Record, 83(261), 208–231. CrossRef
- Did Australia’s Baby Bonus Increase Fertility Intentions and Births?
Population Research and Policy Review
Volume 30, Issue 3 , pp 381-397
- Cover Date
- Print ISSN
- Online ISSN
- Springer Netherlands
- Additional Links
- Author Affiliations
- 1. Institute for Women’s Policy Research, 1200 18th St NW, Suite 301, Washington, DC, 20036, USA
- 2. Pennsylvania State University, University Park, PA, 16802, USA
- 3. Oklahoma State University, 1115 Main Hall, Tulsa, OK, 74106, USA
- 4. Melbourne Institute of Applied Economic and Social Research, University of Melbourne, L7 Alan Gilbert Building, Melbourne, VIC, 3010, Australia