Cash transfers and fertility: how the introduction and cancellation of a child benefit affected births and abortions

Abstract

We study the effects of a universal child benefit on fertility in Spain in the 2000s using administrative, population-level data, identifying separately the effects driven by conceptions and abortions. We exploit the timing of the introduction and cancellation of the policy to infer when the effects on abortions and births can be expected. We find that the introduction led to a 3 percent increase, the announcement of the cancellation to a transitory 4 percent increase, and the cancellation to a 6 percent decrease in birth rates. We perform heterogeneity analysis and find suggestive evidence of both a timing (“tempo”) and a level effect (“quantum”).