Why policies to increase the number of children did not produce results – 04/02/2024 – Market

Between 1980 and 2019, most developed countries approximately tripled their spending per person in real terms on child benefits, subsidized child care, parental leave, and other family-friendly policies. They also saw their birth rates fall from 1.85 to 1.53 per woman.

In egalitarian Finland, home to some of the world’s most family-friendly policies, the fertility rate has fallen by a third since 2010. In Hungary, famous for its extravagant payments designed to increase the number of babies, fewer children were born in last year than at any other time since records began.

Meanwhile, in South Korea, the example of sharply falling fertility, the government’s “baby bonus” program had little effect mainly because it was paid to women who were already planning to have children.

Looking across rich countries, fertility rates are no higher among those where child care is fully subsidized than among those where parents pay exorbitant fees — the link between births and total spending on family-friendly policies is negligible. This often provokes doubts, but it shouldn’t. The decision about having children, and how many, ends up being much more than a question of money.

To be clear, family-friendly policies can have other positive impacts on individuals and society. They make it easier for those who have already chosen to have children to balance family and work. They alleviate child poverty.

But when it comes to analyzing birth rates, culture is much more powerful than politics, often exerting its influence several steps before the point at which childcare costs could become a serious consideration.

There are a number of distinct but related factors at play. The first is the rapid rise of so-called “helicopter parenting.” In their book “Love, Money, and Parenting: How Economics Explains the Way We Raise Our Kids”, Matthias Doepke and Fabrizio Zilibotti argue that the realization that a comfortable life has become impossible to achieve without a high-quality education has triggered an intense status competition between parents. They feel compelled to invest large amounts of time and effort into optimizing their child-rearing. This may have become an impediment.

In 1965, mothers of young children in developed countries spent an average of just over an hour a day doing activities with their children. By 2018, this had risen to three hours, and in South Korea it was approaching four. South Korea’s fertility rate has plummeted to 0.72, while in France, where parenting is much less intensive, birth rates have held up well and now stand at 1.8.

The second big factor is changing priorities for young adults. In 1993, 61% of Americans said having children was important to a fulfilling life, but Pew Research now puts the number at 26%.

A study last year by Lyman Stone, a demographic economist and senior researcher at Canadian think-tank Cardus, shows that the competing priorities that most impact birth rates among young women are the desire to grow as a person and focus on their careers. . Concerns about the demands of “helicopter parenting” also rank high — daycare costs rank 14th.

But just as significant as any individual concern is the anxiety seen among today’s young adults. Two additional studies by Stone show that the more worried a prospective young mother is, the fewer children she plans to have. Combined with the fact that under-30s in Western Europe, East Asia and the Anglo-Saxon sphere are more anxious and stressed than their older counterparts, this could push birth rates further down.

Finally, and perhaps most importantly, the share of young adults in the West living as a couple is declining. As social scientist Alice Evans writes, with women increasingly able to support themselves financially, a traditional reason to bond with someone has ceased to exist. This helps explain why the most recent part of the downward trend in births has been driven not by people deciding to have two children instead of three, but by an increase in the share deciding to have none.

Birth rates in liberal, developed countries appear extremely unlikely to return to replacement level in the near future. If they miraculously do so, it will likely be due to broad social and cultural changes rather than established policies. There is nothing wrong with governments seeking family-friendly packages for other reasons, but if they are concerned about an aging and shrinking population then they need to find other solutions.