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6. Conclusion
This study uses the 1979-2016 waves of the Women’s Marriage, Fertility, and
Employment Survey conducted by the Statistical Department of the Taiwanese Ministry of the Interior survey data to estimate the effect of national health insurance implementation in 1995 on Taiwanese fertility decisions. Evidence from multivariate and difference-in-differences analysis refutes the initial hypothesis that NHI would stimulate fertility by universally lowering the cost of childbirth and child healthcare in Taiwan. After NHI, the newly covered non-government respondents showed lower completed fertility than state-insured control group when regressed according to three maternal cutoff points at 35, 40, and 45 years old, and when stratified by education and income level. Moreover, when the outcome variable was changed to monthly birthrate among the treatment and control groups, with a cutoff point dictated by the March 1995 NHI implementation rate, difference-in-differences analysis again supported the finding that NHI failed to increase Taiwanese childbearing. The small magnitude of OLS and DID coefficients is in line with previous literature on the effect of Medicaid eligibility expansion and other
healthcare policy changes on fertility, although the negative nature of them may be surprising.
Though the magnitudes of the NHI dummy coefficients in OLS regression are small, due to the richness of available survey data the results have high statistical significance; this is echoed in the DID analysis.
The results of this study largely contradict the “cost of children” hypothesis, which indicates that lowering the cost of having or raising children will increase childbearing. Instead, these findings support the child quantity/quality tradeoff, and insinuate that increased health of children due to increased prenatal/postnatal care access might cause parents to have fewer births overall. This explanation is consistent with trends indicating the “yang er fang lao” principle is
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decreasing in importance for Taiwanese households, consistent with the precautionary savings findings of Chou et al. (2003) and elderly consumption results found by Lai and Tung (2015).
Guaranteeing state sponsored health insurance to the population essentially reduces income uncertainty in a unilateral fashion, which may secondarily reduce motivation for childbearing.
Alternatively, the combination of increasing housing prices and wage stagnation in the private sector in Taiwan in the 1990s may also explain why our results contradict the hypothesis that NHI stimulated domestic fertility. Average housing prices in Taiwan rose 70% between 2005 and 2014, while monthly salaries stagnated during the same period (rising only 12.25%, less even than the inflation rate). If adult children are increasingly unable to afford to run their own households, this may further delay marriage and childbearing (Y. Chen, 2015). As shown previously in figure 1, average maternal age at birth has indeed been rising in Taiwan since the 1970s. Wage stagnation in the private sector potentially explains higher fertility in the
government control group of this study, as well, given that the higher job security and overall benefits of state employment may have facilitated higher fertility rates for that sector.
Limitations of this study include incomplete information on employment status for some respondent and incomplete household income information, which was only available in surveys after 1988. Using completed fertility as the outcome variable in the OLS regression relies on the assumption that if NHI was successful, it would push women to increase childbearing; a more precise dependent variable might be whether or not NHI increases their incentives for
childbearing. In the absence of a specific survey question on this topic, national level analysis using national fertility rate would lend support to this study. In addition, lack of direct access to NHI and other insurance records represents a significant limitation in this paper, and inclusion of those records would allow for a more accurate division of the sample into treatment and control
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groups. Future research into the effects of pronatal policy on Taiwanese fertility would benefit from access to insurance records and birth certificate data to improve the accuracy of statistical modeling.
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