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The parental leave benefit: a key family policy measure, one decade later

Economic Bulletin of December 9, 2016

On January 1, 2017, the parental leave benefit will be celebrating its tenth anniversary. Although its implementation was hotly debated, it has become a widely accepted family policy measure. Its impact on parental labor supply, the division of labor between parents, fertility, and indicators that reflect the well-being of parents and children have been examined from a variety of perspectives. A global evaluation of relevant economic studies shows that on average, when young families receive the parental leave benefit as an earnings replacement benefit, their economic stability in the first year after the birth of a child increases. As a result of the parental leave benefit, the employment rate of mothers decreased in the first year after childbirth, while it increased in the second year. While the share of fathers who take parental leave has clearly increased, the effects on the division of labor within the family are inconclusive. Some evidence suggests that the parental leave benefit has some effect on fertility. Little is known about its impact on child development. Overall, the parental leave benefit family policy measure has been successful in many areas. However, its targeted effects could be augmented by additional family policy reforms.