2010
DOI: 10.1007/s11113-010-9193-y
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Did Australia’s Baby Bonus Increase Fertility Intentions and Births?

Abstract: 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,… Show more

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Cited by 69 publications
(68 citation statements)
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References 16 publications
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“…Our findings differ from Drago et al (2010), who found that the introduction of the Baby Bonus produced a small but significant increase in fertility intentions and inferred that a similar increase in fertility would result. The wider range of control variables used in our study, particularly the interactions between age and parity, may explain the differing assessments of the effects of the Baby Bonus.…”
Section: Discussioncontrasting
confidence: 99%
See 1 more Smart Citation
“…Our findings differ from Drago et al (2010), who found that the introduction of the Baby Bonus produced a small but significant increase in fertility intentions and inferred that a similar increase in fertility would result. The wider range of control variables used in our study, particularly the interactions between age and parity, may explain the differing assessments of the effects of the Baby Bonus.…”
Section: Discussioncontrasting
confidence: 99%
“…After controlling for the effects of age and parity and the other variables in the model, fertility increases significantly as the woman's highest level of education increases. 27 Other analyses of the HILDA data have produced a similar result (Drago et al 2010;Parr 2010). The education effects partly reflect the fact that the "catch-up effect" among women in the later reproductive ages is stronger among the more highly educated.…”
Section: Factors Affecting Fertilitymentioning
confidence: 86%
“…A study of Australia's baby bonus policy by the Melbourne Institute of Applied Economic and Social Research found that the new incentive did elevate birth rates through its positive effect on fertility intentions, with the effect stronger among women who had children already (Drago et al 2009). Fertility intentions, in general, were found to be higher among women who were younger or partnered, or had higher levels of income or education.…”
Section: Previous Studiesmentioning
confidence: 99%
“…The 2004 scheme replaced a less lucrative tax offset scheme focused solely on first births (also, to the media, the Baby Bonus) introduced three years earlier, and was accompanied by several other family-friendly welfare initiatives. Assessments of the impact of these measures on Australian fertility have generally used words like -modest‖ and -slight‖ (Lattimore and Pobke 2008;Drago et al 2011;Parr and Guest 2011), but Risse (2010, p. 231) did report an associated -highly significant increase in the childbearing intentions of women from lower-income households‖. This may have manifested itself in increased rates of non-marital conception leading to non-marital confinement at ages 15-24.…”
Section: Conceptionsmentioning
confidence: 99%