Sunday, August 3, 2008

Incentives to Promote Higher Birth Rate May Damage Economy

The Netherlands subsidizes families with 12 billion Euro annually, in the hope that they will be encouraged to have more children, in order to counteract the ageing of the population. However, economists and demographers say that this policy will simply lead to additional costs for the country. Greater subsidies for childcare do not lead to people working longer hours. Financial child benefits can even lead to people working less because the benefits decrease as income increases.

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