Inside the Japanese town that pays cash for kids

The series on Japan's demographic reckoning is funded by the Pulitzer Center on Crisis Reporting. None of the material in this series may be reproduced without an explicit credit to CNN and the Pulitzer Center.

Nagi, Japan (CNN)When Katsunori and Kaori Osaka had their first child, they were living in a cramped apartment in Nagoya, a city of more than 2 million people in central Japan.

Like many other young couples, they tried to raise their child in the city but found life among the apartment blocks too crowded and expensive, with few child care options. Eventually, they gave up.
"When people are in their 20s and 30s, they can't really afford to live in a bigger space in a city," Katsunori said. "We knew that if we wanted to have more kids, we couldn't do it there."
    Cocooned amid hills, the little town of Nagi-cho is also home to a Japan Self Defense Forces garrison and the Nagi Museum of Contemporary Art.
    Fourteen years later, the Osakas moved to Nagi, where Katsunori grew up. The sleepy agricultural town in western Japan has become a success story in the country's efforts to boost its declining birth rate.
      With a population of about 6,000, Nagi feels a world away from Nagoya, and residents cite the lack of busy streets and crowds as reasons why it is a great place to bring up children.
      But they're not the only benefits: Nagi also pays couples who live there to have children.
      Families receive a one-time 100,000 yen ($879) payment for their first child, 150,000 yen ($1,335) for their second and as much as 400,000 yen ($3,518) for the fifth child born to the same family.
        Nagi has been ramping up payments since 2004, as well as offering other fertility-boosting parental perks, to turbocharge the town's birth rate and buck Japan's broader trend of aging populations.
        Perks include subsidized housing, free vaccinations, school allowances and reduced nursery costs.
        And they appear to be working.
        In the neighborhood where the Osakas live, most couples have three or more children because they can and they want to.
        This leaves Nagi in stark contrast to much of Japan.
        Between 2005 and 2014, the town's fertility rate -- based on the average number of children a woman has in her lifetime -- doubled from 1.4 to 2.8, to widespread domestic acclaim.
        Since then, Nagi's total fertility rate has dipped slightly to 2.39 but is still considerably higher than the national average of 1.46.