IEAS Working Paper No. 22-A007, December 2022
This paper utilizes wealth shocks from winning lottery prizes to examine the effect of financial resources on fertility. Using administrative data on Taiwanese lottery winners and a difference-in-differences design, we compare the trend in fertility between households receiving lottery prizes of more than 1 million NT$ (33,000 US$) with those winning less than 10,000 NT$ (330 US$). The results show that the receipt of a big lottery prize significantly increases fertility, and effects are driven by households with less financial resources. Moreover, big lottery wins mainly trigger childless households to have children and induce people to get married earlier.