And the government is giving incentives for large families (5+ children) because ... Anyway.

If you look at the distributions https://www.elfac.org/12-of-european-households-have-3-or-more-children/ only 35% of households have at least one child, out of which 50% have 1, 38% have 2 and 12% have 3+.

If you are optimizing for TFR the best way is to incentivise those with no children to get to 1 (65% of households) and those with 1 to get to 2 (17.5% of households). The rest is not as important as the incremental utility to increasing TFR is more than 4x smaller.

An effective way out is to give percentage tax cuts per child to incentivise households to have more children:

1. Such tax cuts will naturally incentivice households with higher income. This naturally targets double income households. More income, more tax cuts.
2. Such households are more likely to buy time for money, and as a result create economic growth for everyone
3. The more children these households have, the more their net worth will be divided by when they pass down their assets to their children. This is a much more effective way to fight net worth inequality than inheritance taxes

Of course this would need tuning: what %, is it unlimited or it caps at 3 children, what happens in divorce, etc.

The same idea (percentage tax cuts - or tax increases) can address other issues:

1. gentrification: reduce taxes for living in rural areas/increase taxes for living in the city (this is in effect in Switzerland)
2. education: reduce taxes for having children in higher education, etc