Unconditional Cash Transfers and Maternal Labour Supply: The Case of the Two‐Child Limit in the United Kingdom

ABSTRACT I study the impact of a policy in the United Kingdom to restrict per child welfare benefits to the first two births—the Two Child Limit (‘2CL’)—on maternal labour supply. Using regression discontinuity models based on a birth date cut off, I find that, as at March 2021, the policy had increased the economic activity rate of mothers affected by the policy by approximately three percentage points, with indications that the policy had additional impacts at the intensive margin.