Volume 55 - Article 25 | Pages 811–846  

The impact of increased child benefits on tempo and quantum of fertility in Estonia

By Tanel Paas, Allan Puur, Mark Gortfelder

Abstract

Background: On July 1, 2017, Estonia introduced a substantial child allowance for families with three or more children, supplementing regular child benefits. This universal, non-means-tested benefit aimed to alleviate financial burdens for larger families and encourage third and higher-order births.

Objective: We examine the impact of this reform on the likelihood and timing of third births. We hypothesise that the Estonian child benefit reform had a positive impact, given that the total allowances for a family with three children amounted to 41% of the average salary at the time of implementation.

Methods: We analyse longitudinal register data using a mixture cure model embedded within a difference-in-differences framework, which allows us to distinguish between changes in the probability of having a third child and changes in the timing of third births.

Results: We find evidence that the reform was associated with a shortening of the time to third birth by nearly a quarter and a 4 percentage point increase in the probability of a third birth, corresponding to an 11% rise relative to the baseline third birth probability (37%).

Conclusions: The results suggest that a generous child allowance can be linked to changes in both the timing and the likelihood of higher-order births.

Contribution: The study contributes to the broader literature analysing the effects of family benefits on fertility by providing new evidence from longitudinal register data on the association between a generous, universal child benefit and changes in the timing and likelihood of third births in a low fertility context.

Author’s Affiliation

• Tanel Paas - Tallinna Ülikool, Estonia EMAIL
• Allan Puur - Tallinna Ülikool, Estonia EMAIL
• Mark Gortfelder - Tallinna Ülikool, Estonia EMAIL

Other articles by the same author/authors in Demographic Research

Longevity of World War II Estonian volunteers in the Finnish Army: A follow-up study of the impact of the post-war life course and repressions
Volume 43 - Article 39

Educational heterogamy during the early phase of the educational expansion: Results from the university town of Tartu, Estonia in the late 19th century
Volume 43 - Article 13

Co-ethnic marriage versus intermarriage among immigrants and their descendants: A comparison across seven European countries using event-history analysis
Volume 39 - Article 17

The formation of ethnically mixed partnerships in Estonia: A stalling trend from a two-sided perspective
Volume 38 - Article 38

Childbearing among first- and second-generation Russians in Estonia against the background of the sending and host countries
Volume 36 - Article 41

Socioeconomic and cultural differentials in mortality in a late 19th century urban setting: A linked records study from Tartu, Estonia, 1897-1900
Volume 36 - Article 1

Partnership dynamics among migrants and their descendants in Estonia
Volume 32 - Article 56

Varying association between education and second births in Europe: Comparative analysis based on the EU-SILC data
Volume 31 - Article 27

Jobs, careers, and becoming a parent under state socialist and market conditions: Evidence from Estonia 1971-2006
Volume 30 - Article 64

Intergenerational family constellations in contemporary Europe: Evidence from the Generations and Gender Survey
Volume 25 - Article 4

Effects of education on second births before and after societal transition: Evidence from the Estonian GGS
Volume 22 - Article 28

Reconciling studies of men’s gender attitudes and fertility: Response to Westoff and Higgins
Volume 22 - Article 8

Men's childbearing desires and views of the male role in Europe at the dawn of the 21st century
Volume 19 - Article 56

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Volume 17 - Article 10

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