Did Australia's Baby Bonus Increase Fertility Intentions and Births?

Robert Drago, Katina Sawyer, Karina M. Shreffler, Diana Warren, Mark Wooden

Research output: Contribution to journalArticlepeer-review

41 Scopus citations


In May 2004, the Australian government announced a "Baby Bonus" policy, paying women an initial A$3,000 per new child. We use household panel data from the Household, Income and Labour Dynamics in Australia Survey (N = 14,932) and a simultaneous equations approach to analyze the effects of this bonus on fertility intentions and ultimately births. The results indicate that opportunity costs influence intentions and births in predictable ways. Fertility intentions rose after the announcement of the Baby Bonus, and the birth rate is estimated to have risen modestly as a result. The marginal cost to the government for an additional birth is estimated to be at least A$126,000.

Original languageEnglish
Pages (from-to)381-397
Number of pages17
JournalPopulation Research and Policy Review
Issue number3
StatePublished - 1 Jun 2011
Externally publishedYes


  • Baby Bonus
  • Births
  • Fertility
  • HILDA Survey


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