Can the government spend its way to more births?

While few observers believe the new three-child policy announced this week will do much to lift China’s birth rate, some are pinning higher hopes on the promise of more generous welfare benefits for parents. We are sceptical these would have a big impact on China’s demographic trends, however. Chinese couples often point to financial reasons for not having more children. But the experience of elsewhere suggests that there are usually deeper socioeconomic trends behind low birth rates that policymakers will struggle to overcome.