Finance and Accounting Research Seminar - Daniel Karpati - "Maternity Benefits for Female Entrepreneurs: Effects on Business Outcomes and Family Health"

We study the effects of maternity benefits on small-scale female entrepreneurs. Using administrative microdata from the Netherlands, we  study the introduction of a €5,000 unconditional maternity cash benefit. Exploiting eligibility by birth month, we find that eligible mothers reduce their quarterly business revenues on average by €970 more than non-eligible self-employed mothers, but only in the first two years after childbirth, with no long-run effects. The resulting decline in business income amounts to about 60% of the benefit amount, leading to a net increase in household income. Reliance on formal daycare decreases, suggesting that eligible mothers spend more time with their child. Whereas household composition and maternal health remain unaffected, children’s health improves, as reflected in lower healthcare expenditures and reduced medicine use in the first calendar year after birth.