Journal of Population Economics

, Volume 30, Issue 3, pp 875–892 | Cite as

Daddy months

Original Paper
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Abstract

We consider a bargaining model in which husband and wife decide on the allocation of time and disposable income, and fertility. Since her bargaining power would go down otherwise more strongly, the wife agrees to have a child only if the husband also leaves the labor market for a while. The daddy months subsidy enables the couple to overcome a hold-up problem and thereby improves efficiency. However, the same ruling harms other types of couples and may also reduce welfare in an endogenous taxation framework.

Keywords

Fertility Bargaining Family policy Labor supply 

JEL Classification

D13 H21 J13 J18 J22 

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Copyright information

© Springer-Verlag Berlin Heidelberg 2017

Authors and Affiliations

  1. 1.Ifo Institute for Economic Research and University of MunichMunichGermany

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