A note on endogenous fertility, child allowances and poverty traps

► An OLG closed economy with endogenous fertility is analysed. ► We study how capital accumulation and fertility react to a child allowance policy. ► Multiple equilibria are shown to exist depending on the size of the child allowance. ► Fertility can either be of the Malthusian or Modern type in the long run. ► The effect of the child policy on long-run fertility is ambiguous.