Luxembourg and France: Comparable family benefits, comparable fertility levels?

The economic theory of the family as proposed by Becker (1981, 1991) predicts clearly the relationship between income (especially the mother’s income) and fertility. Indeed, it assesses that an income effect and a substitution effect could coexist, whose net impact is thus to be determined empirically. Many authors have already attempted to do so, some interested in the effect of the woman’s wage on fertility, others focusing on the effect of some family policy measures on the decision to have a first child. Our own analysis is situated in this latter framework. Using the Luxembourgish sample of the EU-SILC data, we estimate the effect observed in the Grand-Duchy and compare the result with those obtained in France, a country with quite similar family policies.