Italy is producing so few babies that the government wants to boost the bribe it pays couples to have more kids.
Beatrice Lorenzin, Italy’s health minister, told La Repubblica last week that the government plans to double the amount of money offered to families who choose to have more children in a bid to slow the country’s “apocalyptic” birth rate.
“Just 488,000 babies were born in Italy in 2015, fewer than in any year since the modern state was founded in 1861,” the BBC reported her as saying. ”If we carry on as we are and fail to reverse the trend, there will be fewer than 350,000 births a year in 10 years’ time, 40% less than in 2010—an apocalypse.”
Lorenzin said the monthly bonus for lower-income families should be twice the current rate of €80 ($90), and payments should rise for second and subsequent kids. She also wants it to apply to more families. The annual income ceiling for families receiving the bonus is currently €25,000; she wants to raise it to €30,000.
Italy isn’t the only country that doesn’t make babies like it used to. The average fertility rate in the EU was 2.4 children per woman in 1970, but dropped to 1.5 in 2013, according to the OECD. The OECD says a rate of 2.1 is required to ensure a stable population, so rates below this are bad for countries with aging populations, generous social services, and sclerotic economies. (In other words, for Italy.)
Italy is also far from alone in trying to encourage couples to have more babies. In Denmark, a travel agency created a risqué “Do It for Denmark” campaign to encourage more people to go on romantic trips that encourage baby-making. Japan has said it would spend about ¥3 billion ($30 million) on matchmaking events and robot babies to inspire couples to have more kids. Finland gives away “baby boxes“ with warm clothes and books to new parents.
The research is mixed (pdf) on whether financial incentives induce higher fertility rates. In Italy, high unemployment and a dearth of policies to support working women are to blame for the country’s persistently low birth rates, says Alessandro Rosina, a professor of demography and social statistics at Catholic University of the Sacred Heart in Milan. “The baby bonus is not the most appropriate response to overcome these two barriers and meet reproductive goals in Italy,” he says.
Italy’s fertility rate has been lower before, hitting an all-time low of 1.26 in 2000 before creeping up to 1.46 in 2010, thanks to immigration (foreign-born women tend to have higher fertility rates) and policies aimed at improving work-life balance in Northern Italy, Rosina notes. But further gains have stalled amidst the country’s continued economic malaise.
Expanding baby bonuses would add about €2.2 billion to Italy’s public spending over six years. It would be an unwelcome burden on the country’s slow-growing, debt-laden economy at the moment, but might be a shrewd investment for the future.