- Today's the 1st of July,
and it's an important day for a special group of Australians
because it was on this day in 2004
that more babies were born than any other day
in Australia's recorded history.
Now this wasn't due to chance or coincidence.
It was actually due to a change in law
that led to hundreds of people calling today their birthday.
Now this goes to the field of behavioral economics.
That is, using economic theory
to explain the way that people behave
and the decisions that they make.
Now governments use this type of thinking a lot
when they're passing laws
and putting taxes on behaviors that they don't wanna see.
It's why, for example, there are high taxation
on things like cigarettes, on alcohol,
and things like the soda tax.
Now governments will also financially reward behaviors
and things that they do wanna see.
And in this case, that thing was babies.
So the policy in question is the Baby Bonus,
and here's how it worked.
From the 1st of July, 2004, any baby that was born,
their parents would receive $3,000
as a cash payment from the government.
Now the goal was to support new parents
and try to increase Australia's declining birth rate.
So this is what's called a natural experiment
for the researchers,
answering a question that could be solved in the real world.
Now there are all types of these studies that happen,
and one of them went to two of the certainties of life,
death and taxes.
In that study, what the researchers wanted to know
is could tax law impact when people died?
So it's being shown that people with the end of their life
can will themselves to live longer
if there's a momentous event coming up.
So in the weeks before the new millennium,
there was a decline in the death rate.
And it's being shown that there are fewer deaths
from Jewish people in the week before Passover.
So what the researchers wanted to know
is would this apply to avoid paying tax?
So what they looked at is when countries got rid
of their inheritance tax or their death tax,
and actually found that 50 people that would've died
in the week before Australia got rid of its inheritance tax
actually held on to the following week.
Now the researchers did say that they're not entirely sure
whether information was inducted
or, who knows, maybe families didn't call the doctor
to come in for a couple of extra days
to go in and check on grandpa.
So that's deaths, but let's go back to births.
So the Baby Bonus kicked in on the 1st of July.
Now the reason that date was picked
is it's the start of the Australian financial year.
But the government announced the policy on the 11th of May,
about seven weeks earlier.
And as you know, that's not long enough to make a baby.
So you might ask yourself,
how could this possibly have made a difference?
Well, it turns out that people do have some sway
when they give birth.
It's been shown, for example,
there are far fewer births on weekends.
Now that's because things like caesarean sections
can be scheduled.
And when you're picking a date
in the calendar with the doctor, you'll avoid the weekend.
So in this case, did the timing
of this policy make an impact for births?
And the answer to that was a resounding yes.
The 1st of July, 2004 saw just over 1,000 babies born,
the highest amount than any other day
in Australia's recorded history.
And the day after that, the 2nd of July,
was the fifth highest day in the 30-year period
that the researchers looked at.
And there was a corresponding decline
before the policy came into effect.
The 30th of June was in the bottom 1%
of weekday births in that same 30-year period.
So yes, government policy can impact when we live
and when we die.
So to all of the 1st of July birthday babies out there,
I just wanted to say Happy Birthday.
I'm Julian O'Shea.
Thanks for watching.
I'd love to give a shout-out to the researchers
that did this study, Joshua Gans and Andrew Leigh.
And if you enjoyed this video,
I'd urge you to subscribe for more.
Take care.
It's good.