Baby multiplier: How seeing infants drives the desire for parenthood

Being around babies makes people want babies, according to a new study published by the National Bureau of Economic Research (NBER).

The study posits that exposure to infants in one’s social environment activates neurobiological mechanisms, such as oxytocin release and the brain’s reward circuitry, which naturally increase the desire for parenthood.

This response is affective rather than cognitive, operating through sensory contact rather than deliberate calculation. However, as children become scarcer in modern, age-segregated societies, this vital stimulus weakens, further eroding the motivation to have children. The researchers’ calibrated model suggests that this empathy channel can account for approximately 13.4% of the recent fertility decline.

A key finding of the research is that fertility generates a positive externality. Because each new birth raises the desire for children among surrounding adults, births act as a «public good» that the decentralized market underprovides. This inefficiency leads to «subfertility,» where the actual number of births falls below what a social planner would choose for maximum societal welfare.

To correct this, the authors argue for per-child subsidies, though they identify a significant catch called the «Pigouvian overshoot». They found that standard subsidy formulas often prescribe rates that are 23%–32% too high because they fail to account for the fact that the resulting increase in babies will naturally boost empathy and partially close the fertility gap on its own.

The study also offers a counterintuitive targeting rule for these subsidies. Rather than targeting groups with the largest per-child externality, the authors suggest using Ramsey-like logic to target «high-exposure» groups — typically smaller, cohesive communities where children are less expensive to subsidize. In these groups, each fiscal dollar spent generates the most significant empathy spillover.

Interestingly, the researchers found that a uniform subsidy captures over 98% of the potential welfare gains, making it a practical and politically feasible recommendation.

Read also: Love on hold: South Korea’s youth embrace late marriage.

Ultimately, the paper warns that without intervention, declining fertility may become self-reinforcing as the social cues that trigger the urge to parent continue to disappear.