Fertility and Public Policies - Evidence from Norway and Finland

The relatively high and rising fertility rates of Nordic countries in the late 1980s and early 1990s sparked a renewed research interest in the possible pronatalistic effects of generous family policy programs. Several studies have addressed this issue, but few have tried to model policy effects explicitly. The existing evidence so far is mainly from Sweden, where policy indicators have been incorporated in economic fertility models that also control for female wages. This paper complements previous Swedish analyses with evidence from Norway and Finland. The results corroborate earlier findings of a negative effect of female wages. There are also indications of a positive policy impact, as maternity leave extensions are estimated to raise birth rates, although mainly higher parity births and mainly in Finland.