Can child allowances improve fertility in a gender

Abstract

This paper presents the effects of child allowances on fertility, female labor supply, and economic growth in a gender wage discrimination economy. Child allowances cannot increase fertility in a higher gender discrimination economy. Both theoretical and empirical analyses prove this result. We find that child allowances can increase maternal childcare time. However, the expenditures on market childcare goods and services cannot increase with the decrease of female labor supply and total household income in a higher gender discrimination economy. When both the childcare time and market childcare goods and services are necessary inputs in the parental child care, an increase in child allowances can decrease fertility and per capita output. Moreover, in both the labor market and household, gender equality is critical for encouraging children-bearing. Child allowances can also increase fertility when males actively participate in child care.