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Does the Welfare State Destroy the Family? Evidence from OECD Member Countries
Author(s) -
Halla Martin,
Lackner Mario,
Scharler Johann
Publication year - 2016
Publication title -
the scandinavian journal of economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.725
H-Index - 64
eISSN - 1467-9442
pISSN - 0347-0520
DOI - 10.1111/sjoe.12144
Subject(s) - fractionalization , economics , fertility , welfare state , welfare , legislature , state (computer science) , total fertility rate , demographic economics , politics , labour economics , family planning , political science , ethnic group , population , market economy , sociology , research methodology , law , demography , algorithm , computer science
We study the effect of the size of the welfare state on demographic trends in OECD member countries. Exploiting exogenous variation in public social spending, due to varying degrees of political fractionalization (i.e., the number of relevant parties involved in the legislative process), we show that an expansion in the welfare state increases fertility, marriage, and divorce rates with a quantitatively stronger effect on the marriage rate. We conclude that the welfare state supports family formation in the aggregate. Further, we find that the welfare state decouples marriage and fertility, and therefore alters the organization of the average family.