Child-related Transfers, Household Labor Supply, and Fertility

Child-related Transfers, Household Labor Supply, and Fertility

Francesca Parodi (University of Milan)

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ABSTRACT:

This paper investigates the effects of Italy’s Assegno Unico Universale (AUU), a universal child-related cash transfer introduced in 2022, on fertility and maternal employment. Using the reform's announcement timing and variation in household exposure, we study outcomes across income levels, geographic areas, and access to childcare. We find that AUU had no impact on aggregate fertility. Focusing on low-income private-sector mothers, we show that  the transfer increased the likelihood of having a second child, affected the timing of the second birth, and reduced the probability of maternal employment at the extensive margin, while it had no significant effect on working hours or take up of parental leave. Our findings highlight the importance of taking into account the complex interaction between income and substitution effects for effective policy design.

BIO:

Francesca is an Assistant Professor of Economics at University of Milan, she is also Research Fellow at the Institute for Fiscal Studies and Research Affiliate of CEPR. Her main research interests are Macroeconomics, Public Economics, and Household Finance. She obtained her PhD in Economics from University College London.