Income Risk, the Tax‐benefit System and the Demand for Children

Datos Bibliográficos

ID9727482
AutoresClive D Fraser (0000-0001-5942-6493, University of Leicester, autor de correspondencia)
Año2001
Volumen68
Número269
Páginas105-126
Fecha de publicación2001-02-01
Peer ReviewedSí
Open AccessSí
TipoARTICLE
RevistaEconomica (JOURNAL)
Identificadores de la revistaISSN: 0013-0427 • E-ISSN: 1468-0335
EditorialWiley (PUBLISHER • GB)
DOI10.1111/1468-0335.00236
OpenAlexW2008777821
IdiomaEN
Citas recibidas5
Referencias citadas17

Because children represent an irreversible commitment, parents might hedge against higher income risk by having fewer children. We show that, under plausible assumptions, recent increases in income risk might have reduced prudent parents’ desired fertility. Responses to this via the tax‐benefit system are considered. Introducing an expected revenue‐neutral transfer‐cum‐child‐benefit system under proportional taxation, which lets the government share the household’s income risk, increases desired fertility for parents who would choose to have small families in this system’s absence. Pound for pound, the targeted child benefit enhances fertility more than the lump‐sum transfer

Demographic economics · Economics · Fertility · Hedge · Income tax · Labour economics · Pound (networking) · Public economics · Revenue · Tax revenue · Demography · Family Dynamics and Relationships · Finance · Financial Literacy, Pension, Retirement Analysis · Gender, Labor, and Family Dynamics