Fertility, female labor supply, and household saving evidence from relaxing the one-child policy in China

This paper examines how households reacted to the dismantling of the one-child policy, which China relaxed in 2013 and eliminated prior to 2017. We use household survey data and a series of regressions to show that birth rates, female labor force participation, and household saving rates have already changed. Between 2015 and 2017, the proportion of households with children having more than one child increased by at least five percentage points. Moreover, within households adding another child, female labor force participation and saving rates significantly decreased. Our paper contributes to the empirical literature on the economic impacts of pro-fertility policies and has implications for the theories of why households save.