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Québec's Baby Bonus: Can public policy raise fertility?

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Milligan, Kevin
Publication Date: 
24 Jan 2002

Excerpts from introduction: In 1988, Quebec introduced the Allowance for Newborn Children, a pro-natalist child benefit that paid up to $8,000 to a family after the birth of a child. Was the program successful? It achieved its goal of increasing family size, but only at a high cost per additional birth. Each child who would not have been born in the absence of the incentive cost the public purse more than $15,000. The main policy lesson from this episode is that, even if the response to an incentive policy is strong, the effective cost per desired result may be very high.