Template-Type: ReDIF-Paper 1.0

Author-Name: Kamila Cygan-Rehm
Author-X-Name-First: Kamila
Author-X-Name-Last: Cygan-Rehm


Title: Parental leave benefit and differential fertility responses: Evidence from a German reform

Abstract: This paper examines the causal effects of a major change in the German parental leave benefit
scheme on fertility. I use the unanticipated reform in 2007 to assess how a move from a
means-tested to an earnings-related benefit affects higher-order births. By using the German
Mikrozensus 2010, I find that the reform significantly affected the timing of higher-order births
in the first three years. Overall, mothers initially reduce childbearing, thereby extending their
birth spacing, but eventually fully compensate for the earlier losses. The negative effects are
largely driven by lowest-income mothers who also do not display any catch-up effects. I also
find a substantial heterogeneity inWest and East Germany. Because the reform aimed at parents
with strong labor market attachment, the positive effects in the East suggest that the economic
incentives essentially perform well, but their impact may be hampered by unfavorable institutional
and cultural conditions in the West.

Length:  37 pages
Creation-Date:  2013-10
File-URL: http://www.bgpe.de/texte/DP/142_Cyganrehm.pdf
File-Format: Application/pdf
File-Function: First version, 2013
Number: 142
Classification-JEL: J13, J18, J20, K36
Keywords: fertility, family policy, reform, parental leave, Germany
Handle: RePEc:bav:wpaper:142_Cyganrehm