Does the Welfare State Destroy the Family? Evidence from OECD Member Countries

Martin Halla, Mario Lackner, Johann Scharler

Publication: Working/Discussion PaperWU Working Paper

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We study the effect of the size of the welfare state on family outcomes 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 the fertility, marriage, and divorce rates with a quantitatively stronger effect on the marriage rate.
We conclude that the welfare state supports family formation. Nevertheless, we also find that the welfare state decouples marriage and fertility, and therefore, alters the organization of the family. (authors' abstract)
Original languageEnglish
Place of PublicationVienna
PublisherWU Vienna University of Economics and Business
Publication statusPublished - 1 Feb 2013

Publication series

SeriesDepartment of Economics Working Paper Series

WU Working Paper Series

  • Department of Economics Working Paper Series

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