How religion mediates the fertility response to maternity benefits

Abstract

Do religious beliefs affect responses to fertility incentives? We examine a 1982 maternity benefits expansion in Estonia, Latvia and Lithuania in a difference‐in‐differences framework with similar East European countries as comparisons. To isolate the importance of religion, we compare women who did and did not grow up in religious households when religion was formally outlawed, resulting in similar adult characteristics among women in the Baltics by importance of religion. Maternity benefits increased fertility only among women who grew up in religious families, providing novel evidence that cultural norms transmitted through the family can amplify the effects of public policies.