I would agree with the author that paid paternity leave should become an important issue within our society. Just having paid maternity leave systems, and not paid paternity leave systems as well, becomes a serious form of sex discrimination, and even things such as the Baby Bonus are basically paid only to the mother at present.

However I think that the decline in the birth rate can be attributed to a number of factors, not just finance or economics. Women in marriage have more children than women in single parent families, or women in cohabitation or de facto relationships etc, and in fact these types of relationships contain higher rates of just about every other type of social ill including higher rates of separation, child abuse, child poverty, welfare dependency, STD’s, abortion etc.

Basically, with a decline in marriage, and high rates of divorce, then the birth rates decline. This is found in almost every developed country, regardless of the economics of that country.

However an increase in paid paternity leave will help fathers become recognised as being actual parents, and not just second class parents, or second class citizens as at present.

Can one consider baby production simply in the context of needs to support continuance of lifestyles? Surely one must also consider very carefully such things as the carrying capacity of our land. How many people Australia can support? Current thinking has this as a figure below our present population number.

Our life style is surely as much a product of advertising and creation of wants. Intended to satisfy our human needs or those of the moneyed elite? Is our current form of economics the only one or is there a system more centered on human needs or at least with a balance tilted toward such?

Resources are being used at unsustainable rates is part of a long-term economic structure increased attention to recycling and efficiency of use? This implies a higher level of government interference just as the perceived ideological wisdom has it that government activity should be minimized in favor of the private sector. The work at the Rocky Mountain Institute says there is profit here for the private sector, certainly B P has reduced waste made production more efficient and profitted.

Thanks for this interesting article with some original ideas. The interface between economics, industry and reproductive decision-making is fascinating, and desperately in need of some critical analysis and creative thinking.

>>Put simply, Australia’s low birth rate is an example of market failure: market failure which justifies some form of government intervention.<<

Put simply, Australia's low birth rate is a social phenomenon that will not respond to government intervention in a stable and predictable manner.

If government imposes additional penalties on business in order to "address the problem", they will introduce further imbalance of risk/reward into the small business community.

Large businesses will simply pick and choose their new hires to avoid the problem completely. And continually chasing this down with additional "fairness" laws won't help; they'll just make more people redundant.

Nor is the answer to use taxpayers (that's where governments get their money, Chris) to subsidise twelve months of maternity/paternity leave - in addition to guaranteeing them their job back, no doubt. That just avoids the issue by lumbering everyone else with the responsibility to pay for it. Academic thinking at its most shortsighted, but much favoured by politicians, who haven't been within a bulls roar of a real job in their lives.

The real market failure here is allowing bank cartels to rip off their clients (the "big four" alone extract $1,500 a year in after-tax income from the pocket of every wage earner in the country), selling off public assets to allow private companies to rip off consumers for essential services (roads, buses, water, electricity etc.etc), and so on. Address that, and you will have no need to "encourage" people to have kids by showering them with gifts paid for by their already over-taxed brethren.

A policy of paid parental leave may actually decrease the burden on individual taxpayers in the long-term.

As I point out in the article, Australia has a changing demographic. With an ageing population the amount of taxpayers as a proportion of the Australian population will start to decrease in the future. This would require increased taxation of taxpayers to maintain current levels of government expenditure and such increased taxation would have a negative impact upon efficiency and incentives.

A policy of paid parental leave could help counter this demographic change by encouraging Australians to have children and therefore decrease the burden on individual taxpayers in the long-term.

I assumed that if the youthful population gets low in future, the government will simply "import" more of them through immigration.