## Sweden and Germany: Case Studies of Children-Related Policies (excerpt) ## Source details **Canonical URL:** [Sweden and Germany: Case Studies of Children-Related Policies (excerpt)](https://www.imf.org/-/media/files/publications/selected-issues-papers/2024/english/sipea2024025.pdf) ## Other formats - [Markdown version](/-/media/files/publications/selected-issues-papers/2024/english/sipea2024025.pdf.md) - [Structured JSON version](/-/media/files/publications/selected-issues-papers/2024/english/sipea2024025.pdf.json) --- ### Policy designs and timelines - Sweden and Norway: introduction of "daddy quota" in 1993 (Norway) and 1995 (Sweden) that reserves a part of paid parental leave periods for fathers; the reserved period is lost to the family if the father does not take leave. - Germany: - Daycare Expansion Act approved in 2004. - Childcare Expansion Act approved in 2007 to introduce all-day schools and childcare facilities for children aged 0-2. - Since 2013, parents are entitled to request institutional childcare for their child from their first birthday onwards. - In 2007, a new parental leave system similar to the Swedish "daddy quota" was introduced. - Since 2015, a flexible parental leave system allows parents to take leave on a part-time basis for up to 36 months. ### Outcomes and uptake - Norway: usage rate of paternity leave rose from 4 percent to above 90 percent from 1995 to 2003. - Sweden: usage rate of paternity leave stands near 90 percent. - Germany: - Over 90 percent of children between the ages of three and six spend at least part of the day in kindergarten (UNFPA (2019) description). - In 2017, 45 percent of parents with children under the age of 3 expressed their wish to enroll them in childcare, yet only 33 percent secured enrollment. - Childcare provision for children aged 0-2 still falls short of demand, particularly in the western part of Germany. ### Mechanisms linking policies to fertility - Daddy quota (Sweden/Norway/Germany reforms): strong financial and entitlement incentive for fathers to take paternity leave, substantially increasing paternal uptake and sharing childcare responsibilities. - Expansion of childcare facilities (Germany): increases accessibility of institutional care, reduces time burden on mothers, and supports labor market continuity for women—contributing to higher fertility outcomes, particularly among certain groups. - Flexible parental leave (Germany, since 2015): allows parents to take leave part-time for extended periods (up to 36 months), offering greater work–childcare compatibility. ### Observed fertility impacts and contributing factors - Germany experienced a moderate increase in the fertility rate over the past decade. Contributing factors include: - Higher fertility rates among incoming migrants. - Policy reforms that, according to Sobotka, Matysiak, and Brzozowska (2019), have contributed to a rise in fertility rates among highly educated women at later stages of childbearing. - Sweden and Norway: high paternity leave uptake following daddy quota introduction is noted as a successful policy outcome that promotes paternal involvement. ### Key implications for policy - Reserving non-transferable parental leave for fathers (daddy quota) can produce a rapid and large increase in male uptake of paternity leave (example: Norway from 4 percent to above 90 percent, Sweden near 90 percent). - Expanding childcare availability for young children, including children aged 0-2, increases institutional care usage and can help support higher fertility rates; however, gaps in supply (e.g., Germany for ages 0-2) can constrain demand. - Complementary measures—parental leave reform, childcare expansion, and income-sensitive fee structures—work together to narrow the gender gap in childcare responsibilities and support childbearing decisions. ### Empirical analysis: Multiple regressions on OECD subsample (excerpt) ### Main empirical findings - The only policy that successfully boosts fertility is pre-school childcare enrollment. - Increasing pre-school childcare enrollment by one percentage point has an effect comparable to the effective increase in GDP per capita by 10,000 USD. - Cash benefits have no significant effect on fertility. - For some policy variables (e.g., duration of parental leave and gender gap in unpaid work) the available dataset is short; insignificant coefficients for these variables may be an artifact of small sample size. ### Main cross-country regression results (Table 3: Fertility Growth and Policies) - Real GDP Growth (%) - Column (1): 0.559*** (t = 4.27) - Column (2): 0.612*** (t = 3.84) - Column (3): 1.238** (t = 2.71) - Column (4): 0.538*** (t = 3.50) - Column (5): 0.0339 (t = 0.16) - Column (6): 0.790 (t = 1.14) - Column (7): 0.742** (t = 3.10) - GDP per capita (10,000 USD) - Column (1): 0.0656 (t = 1.96) - Column (2): 0.135** (t = 2.99) - Column (3): 0.0534 (t = 1.18) - Column (4): 0.0541 (t = 1.59) - Column (5): 0.0746 (t = 1.49) - Column (6): 0.286* (t = 2.32) - Column (7): 0.125 (t = 1.67) - Real GDP Growth (%) * GDP per capita - Column (1): -0.00655* (t = -2.00) - Column (2): -0.00804* (t = -2.17) - Column (3): -0.0110** (t = -2.74) - Column (4): -0.00262 (t = -0.75) - Column (5): -0.0107* (t = -2.34) - Column (6): -0.0319* (t = -2.25) - Column (7): -0.0124* (t = -2.03) - Cash benefits for families (% of GDP) - Column (2): 1.512 (t = 1.39) - GDP Growth * Cash benefits - Column (2): -0.194 (t = -1.66) - Children aged 0-2 in formal childcare (%) - Column (2): -0.0214 (t = -0.37) - GDP Growth * Children 0-2 in childcare - Column (2): -0.0111* (t = -2.04) - Children aged 3-5 in pre-primary (%) - Column (3): 0.120 (t = 1.26) - GDP Growth * Children 3-5 in pre-primary - Column (3): -0.0114* (t = -2.06) - Total expenditure on families (% of GDP) - Column (4): 2.575** (t = 2.76) - GDP Growth * Expenditure on families - Column (4): -0.160 (t = -1.79) - Parental leave duration (days) - Column (5): 0.0616 (t = 0.60) - GDP Growth * Parental leave - Column (5): 0.00306 (t = 0.41) - Parental leave duration: Men - Column (6): -0.0578 (t = -0.25) - GDP Growth * Parental leave: Men - Column (6): 0.00710 (t = 1.00) - Gender gap in unpaid work (ratio) - Column (7): -65.54** (t = -3.25) - GDP Growth * Gender gap in unpaid work - Column (7): -1.225 (t = -1.69) - Additional model features - Controls: Yes (in all columns) - Country FE, Year, and Year^2: Yes (in all columns) - Constant: Yes (in all columns) - Sample size line: N639418425601249100178 - Note: t statistics in parentheses; * p<0.05, ** p<0.01, *** p<0.001 ### Policy implications (sections 19–23) - Sustained economic growth - Fertility rate growth is procyclical with respect to GDP growth; sustained economic growth plays a fundamental role in raising fertility rate. - Authorities should pursue sound macroeconomic management to support continuous economic growth in addition to fertility-specific policies. - Expand childcare facilities for infants - Empirical analysis and case study suggest further expansion of childcare facilities to infants could help improve Japan’s fertility rate. - Waitlist for children aged 0-2 remains relatively high; waitlist numbers may be underrepresented because children whose parents are on parental leave can be excluded from waitlist statistics. - A key bottleneck is shortage of nursery teachers: job-to-applicants ratio of nursery teachers is 3.1, more than double the national average of 1.4 as of January 2023. - Nursery teacher wages are about 17 percent lower compared with that of full-time employees. - Policy recommendations: - Address staff shortages and expand availability of childcare facilities, particularly for infants. - Attract foreign workers to address nursery teacher shortages as a complementary measure. - Facilitate fathers’ contributions to home/childcare - Recent measures to facilitate parental leave and the co-parenting initiative under the “Children's Future Strategy” are constructive steps. - Better designed parental leave with incentives for fathers (for example, “daddy quota” like in Norway and Sweden) could improve burden sharing of childcare and housework. - Current “papa-mama parental leave plus” scheme in Japan has limited incentive for fathers because mothers can take paid leave for up to two years under certain conditions regardless of father’s leave length. - In Sweden and Norway, shortening paid maternity leave relative to parental leave creates incentives for fathers to take paternity leave; implementing a similar mechanism in Japan could incentivize more fathers to take longer paternity leaves. - Workstyle and labor market reforms - Further progress on workstyle reforms, including teleworking and flexible working hours, can support fertility and childcare arrangements by allowing women more flexible work and enabling men to share housework. - Many women opt for part-time jobs that under-utilize skills due to inflexible full-time schedules and long working hours. - Reducing labor market dualism and encouraging more regular employment would help women continue career development, reduce financial concerns about childbearing, and contribute to raising the fertility rate. - IPSS survey findings cited: - Women under regular employment have higher likelihood of returning to employment compared to non-regular employment, partly due to better access to parental leave. - Women in regular employment are more willing to have more children. *International Monetary Fund — Excerpt from chapter "18. We run multiple regressions that test the effectiveness of different policy measures separately" and accompanying sections* ### 1. Sweden and Germany: Case Studies of Children-Related Policies ____________________ 6 ### Sweden and Germany: Case Studies of Children-Related Policies ### Policy designs and timelines - Sweden and Norway: introduction of "daddy quota" in 1993 (Norway) and 1995 (Sweden) that reserves a part of paid parental leave periods for fathers; the reserved period is lost to the family if the father does not take leave. - Germany: - Daycare Expansion Act approved in 2004. - Childcare Expansion Act approved in 2007 to introduce all-day schools and childcare facilities for children aged 0-2. - Since 2013, parents are entitled to request institutional childcare for their child from their first birthday onwards. - In 2007, a new parental leave system similar to the Swedish "daddy quota" was introduced. - Since 2015, a flexible parental leave system allows parents to take leave on a part-time basis for up to 36 months. ### Outcomes and uptake - Norway: usage rate of paternity leave rose from 4 percent to above 90 percent from 1995 to 2003. - Sweden: usage rate of paternity leave stands near 90 percent. - Germany: - Over 90 percent of children between the ages of three and six spend at least part of the day in kindergarten (UNFPA (2019) description). - In 2017, 45 percent of parents with children under the age of 3 expressed their wish to enroll them in childcare, yet only 33 percent secured enrollment. - Childcare provision for children aged 0-2 still falls short of demand, particularly in the western part of Germany. ### Mechanisms linking policies to fertility - Daddy quota (Sweden/Norway/Germany reforms): strong financial and entitlement incentive for fathers to take paternity leave, substantially increasing paternal uptake and sharing childcare responsibilities. - Expansion of childcare facilities (Germany): increases accessibility of institutional care, reduces time burden on mothers, and supports labor market continuity for women—contributing to higher fertility outcomes, particularly among certain groups. - Flexible parental leave (Germany, since 2015): allows parents to take leave part-time for extended periods (up to 36 months), offering greater work–childcare compatibility. ### Observed fertility impacts and contributing factors - Germany experienced a moderate increase in the fertility rate over the past decade. Contributing factors include: - Higher fertility rates among incoming migrants. - Policy reforms that, according to Sobotka, Matysiak, and Brzozowska (2019), have contributed to a rise in fertility rates among highly educated women at later stages of childbearing. - Sweden and Norway: high paternity leave uptake following daddy quota introduction is noted as a successful policy outcome that promotes paternal involvement. ### Key implications for policy - Reserving non-transferable parental leave for fathers (daddy quota) can produce a rapid and large increase in male uptake of paternity leave (example: Norway from 4 percent to above 90 percent, Sweden near 90 percent). - Expanding childcare availability for young children, including children aged 0-2, increases institutional care usage and can help support higher fertility rates; however, gaps in supply (e.g., Germany for ages 0-2) can constrain demand. - Complementary measures—parental leave reform, childcare expansion, and income-sensitive fee structures—work together to narrow the gender gap in childcare responsibilities and support childbearing decisions. *Source: Box 1. Sweden and Germany: Case Studies of Children-Related Policies (excerpt from sipea2024025).* ### 18. We run multiple regressions that test the effectiveness of different policy measures separately ### 18. We run multiple regressions that test the effectiveness of different policy measures separately on the subsample of OECD member countries ### Empirical findings on policy effectiveness - The only policy that successfully boosts fertility is pre-school childcare enrollment. - Increasing pre-school childcare enrollment by one percentage point has an effect comparable to the effective increase in GDP per capita by 10,000 USD. - Cash benefits have no significant effect on fertility, illustrating that this commonly accepted practice has questionable effectiveness in boosting fertility. - For some policy variables (e.g., duration of parental leave and gender gap in unpaid work) the available dataset is short; insignificant coefficients for these variables may be an artifact of small sample size. ### Main cross-country regression results (Table 3: Fertility Growth and Policies) - Real GDP Growth (%) - Column (1): 0.559*** (t = 4.27) - Column (2): 0.612*** (t = 3.84) - Column (3): 1.238** (t = 2.71) - Column (4): 0.538*** (t = 3.50) - Column (5): 0.0339 (t = 0.16) - Column (6): 0.790 (t = 1.14) - Column (7): 0.742** (t = 3.10) - GDP per capita (10,000 USD) - Column (1): 0.0656 (t = 1.96) - Column (2): 0.135** (t = 2.99) - Column (3): 0.0534 (t = 1.18) - Column (4): 0.0541 (t = 1.59) - Column (5): 0.0746 (t = 1.49) - Column (6): 0.286* (t = 2.32) - Column (7): 0.125 (t = 1.67) - Real GDP Growth (%) * GDP per capita - Column (1): -0.00655* (t = -2.00) - Column (2): -0.00804* (t = -2.17) - Column (3): -0.0110** (t = -2.74) - Column (4): -0.00262 (t = -0.75) - Column (5): -0.0107* (t = -2.34) - Column (6): -0.0319* (t = -2.25) - Column (7): -0.0124* (t = -2.03) - Cash benefits for families (% of GDP) - Column (2): 1.512 (t = 1.39) — not significant at conventional levels - GDP Growth * Cash benefits - Column (2): -0.194 (t = -1.66) - Children aged 0-2 in formal childcare (%) - Column (2): -0.0214 (t = -0.37) - GDP Growth * Children 0-2 in childcare - Column (2): -0.0111* (t = -2.04) - Children aged 3-5 in pre-primary (%) - Column (3): 0.120 (t = 1.26) - GDP Growth * Children 3-5 in pre-primary - Column (3): -0.0114* (t = -2.06) - Total expenditure on families (% of GDP) - Column (4): 2.575** (t = 2.76) - GDP Growth * Expenditure on families - Column (4): -0.160 (t = -1.79) - Parental leave duration (days) - Column (5): 0.0616 (t = 0.60) - GDP Growth * Parental leave - Column (5): 0.00306 (t = 0.41) - Parental leave duration: Men - Column (6): -0.0578 (t = -0.25) - GDP Growth * Parental leave: Men - Column (6): 0.00710 (t = 1.00) - Gender gap in unpaid work (ratio) - Column (7): -65.54** (t = -3.25) - GDP Growth * Gender gap in unpaid work - Column (7): -1.225 (t = -1.69) - Additional model features - Controls: Yes (in all columns) - Country FE, Year, and Year^2: Yes (in all columns) - Constant: Yes (in all columns) - Sample size line: N639418425601249100178 - Note: t statistics in parentheses; * p<0.05, ** p<0.01, *** p<0.001 ### Policy implications (sections 19–23) - Sustained economic growth - Fertility rate growth is procyclical with respect to GDP growth; sustained economic growth plays a fundamental role in raising fertility rate. - Authorities should pursue sound macroeconomic management to support continuous economic growth in addition to fertility-specific policies. - Expand childcare facilities for infants - Empirical analysis and case study suggest further expansion of childcare facilities to infants could help improve Japan’s fertility rate. - Waitlist for children aged 0-2 remains relatively high; waitlist numbers may be underrepresented because children whose parents are on parental leave can be excluded from waitlist statistics. - A key bottleneck is shortage of nursery teachers: job-to-applicants ratio of nursery teachers is 3.1, more than double the national average of 1.4 as of January 2023. - Nursery teacher wages are about 17 percent lower compared with that of full-time employees. - Policy recommendations: - Address staff shortages and expand availability of childcare facilities, particularly for infants. - Attract foreign workers to address nursery teacher shortages as a complementary measure. - Facilitate fathers’ contributions to home/childcare - Recent measures to facilitate parental leave and the co-parenting initiative under the “Children's Future Strategy” are constructive steps. - Better designed parental leave with incentives for fathers (for example, “daddy quota” like in Norway and Sweden) could improve burden sharing of childcare and housework. - Current “papa-mama parental leave plus” scheme in Japan has limited incentive for fathers because mothers can take paid leave for up to two years under certain conditions regardless of father’s leave length. - In Sweden and Norway, shortening paid maternity leave relative to parental leave creates incentives for fathers to take paternity leave; implementing a similar mechanism in Japan could incentivize more fathers to take longer paternity leaves. - Workstyle and labor market reforms - Further progress on workstyle reforms, including teleworking and flexible working hours, can support fertility and childcare arrangements by allowing women more flexible work and enabling men to share housework. - Many women opt for part-time jobs that under-utilize skills due to inflexible full-time schedules and long working hours. - Reducing labor market dualism and encouraging more regular employment would help women continue career development, reduce financial concerns about childbearing, and contribute to raising the fertility rate. - IPSS survey findings cited: - Women under regular employment have higher likelihood of returning to employment compared to non-regular employment, partly due to better access to parental leave. - Women in regular employment are more willing to have more children. *International Monetary Fund — Excerpt from chapter "18. We run multiple regressions that test the effectiveness of different policy measures separately" and accompanying sections* --- _Source: https://www.imf.org/-/media/files/publications/selected-issues-papers/2024/english/sipea2024025.pdf_