Identifying the Effect of Parenthood on Labor Force Participation: A Gender Comparison
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ID: 282688
2022
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Abstract
Identifying the factors that influence labor force participation could
elucidate how individuals arrive at their labor supply decisions, whose
understanding is, in turn, of crucial importance in analyzing how the supply
side of the labor market functions. This paper investigates the effect of
parenthood status on Labor Force Participation (LFP) decisions using an
individual-level fixed-effects identification strategy. The differences across
individuals and over time in having or not having children as well as being or
not being in the labor force provide the variation needed to assess the
association between individuals' LFP behavior and parenthood. Parenthood could
have different impacts on mothers than it would on fathers. In order to look at
the causal effect of maternity and paternity on LFP separately, the data is
disaggregated by gender. To this end, the effect of a change in the parenthood
status can be measured using individual-level fixed-effects to account for
time-invariant characteristics of individuals becoming a parent. The primary
data source used is the National Longitudinal Surveys (NLS). Considering the
nature of LFP variable, this paper employs Binary Response Models (BRMs) to
estimate LFP equations using individual-level micro data. The findings of the
study show that parenthood has a negative overall effect on LFP. However,
paternity has a significant positive effect on the likelihood of being in the
labor force, whilst maternity has a significant negative impact of LFP. In
addition, the results imply that the effect of parenthood on LFP has been
fading away over time, regardless of the gender of parents. These two pieces of
evidence precisely map onto the theoretical predictions made by the related
mainstream economic theories (the traditional neoclassical theory of labor
supply as well as Becker's household production model). These results are ...
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| Reference Key |
moosavian2022identifying
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| Authors | Seyyed Ali Zeytoon Nejad Moosavian |
| Journal | arXiv |
| Year | 2022 |
| DOI |
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