Subsidizing the Stork: New Evidence on Tax Incentives and Fertility

Subsidizing the Stork: New Evidence on Tax Incentives and Fertility

This paper exploits the introduction of a pro-natalist transfer policy in the Canadian province of Quebec that paid up to C$8,000 to families having a child. I implement a quasi-experimental strategy by forming treatment and control groups defined by time, jurisdiction, and family type. The incentive was available broadly, rather than to a narrow population as studied in previous work, providin...

Reducing the Excess Burden of Subsidizing the Stork: Joint Taxation, Individual Taxation, and Family Tax Splitting

Analyzing a homogenous household setting with endogenous fertility and endogenous labor supply, we demonstrate that moving from joint taxation to individual taxation and adapting child benefits so as to keep fertility constant entails a Pareto improvement. The change is associated with an increase in labor supply and consumption and a reduction of the marginal income tax, while the child benefi...

Tax Incentives: Issue and Evidence

Fertility Response To Financial Incentives Evidence from the Working Families Tax Credit in the UK

The introduction of the 1999 Working Families Tax Credit (WFTC) in the UK encouraged low income families with children to enter the labor market. The tax credit, however, may have had the unintended side effect of increasing the childbearing of these households. While many studies have looked at the importance of WFTC on the female labor supply, only few have estimated the impact it had on fert...

The Effect of State Income Tax Apportionment and Tax Incentives on New Capital Expenditures

This study examines how variations in states’ corporate income tax regimes affect new capital investment by business. Using U.S. state-aggregated data from 1983 to 1996, we find in pooled and fixed-effects regressions that new capital expenditures by corporations in the manufacturing sector are decreasing in the income tax burden on property (measured as the product of the statutory tax rate an...