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Why is the share of women willing to work in East Germany larger than in West Germany? A logit model of extensive labour supply decision

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  • Beate Grundig
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    Abstract

    The aim of the paper is to analyse differences in the labour force participation (LFP) between East and West German women. Using microcensus data in a binary choice model, we distinguish three main explanations for these differences: the skill composition, the regional labour market and childcare availability. As LFP in-creases in the skill-level, the larger share of high-skilled women in East Germany can explain more than 10 percent of the differences. Whereas East German women do not vary their efforts when regional labour market conditions worsen, West German women are discouraged thereof. Female LFP in East Germany is positively influenced by the provision of full-time childcare while West German women do not show any significant reaction.

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    File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-Ifo_Working_Papers/wp-ifo-2005-2010/IfoWorkingPaper-56.pdf
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    Bibliographic Info

    Paper provided by Ifo Institute for Economic Research at the University of Munich in its series Ifo Working Paper Series with number Ifo Working Paper No. 56.

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    Date of creation: 2008
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    Handle: RePEc:ces:ifowps:_56

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    Keywords: Female labour supply; childcare; logit model; decomposition;

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    1. Katharina Wrohlich, 2004. "Child Care Costs and Mothers' Labor Supply: An Empirical Analysis for Germany," Discussion Papers of DIW Berlin 412, DIW Berlin, German Institute for Economic Research.
    2. Shimada, Haruo & Higuchi, Yoshio, 1985. "An Analysis of Trends in Female Labor Force Participation in Japan," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 3(1), pages S355-74, January.
    3. Denise Doiron & Guyonne Kalb, 2004. "Demands for Childcare and Household Labour Supply in Australia," Melbourne Institute Working Paper Series, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne wp2004n06, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    4. Holger Bonin & Rob Euwals, 2002. "Participation Behavior of East German Women after German Unification," William Davidson Institute Working Papers Series, William Davidson Institute at the University of Michigan 477, William Davidson Institute at the University of Michigan.
    5. Lundberg, Shelly, 1985. "The Added Worker Effect," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 3(1), pages 11-37, January.
    6. Cramer,J. S., 2003. "Logit Models from Economics and Other Fields," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521815888.
    7. Ofer, Gur & Vinokur, Aaron, 1985. "Work and Family Roles of Soviet Women: Historical Trends and Cross-Section Analysis," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 3(1), pages S328-54, January.
    8. van Ham, Maarten & Büchel, Felix, 2004. "Unwilling or Unable? Spatial, Institutional and Socio-Economic Restrictions on Females' Labor Market Access," IZA Discussion Papers 1034, Institute for the Study of Labor (IZA).
    9. Colombino, Ugo & De Stavola, Bianca, 1985. "A Model of Female Labor Supply in Italy Using Cohort Data," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 3(1), pages S275-92, January.
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    11. Heckman, James J & Macurdy, Thomas E, 1980. "A Life Cycle Model of Female Labour Supply," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 47(1), pages 47-74, January.
    12. Hernandez Iglesias, Feliciano & Riboud, Michelle, 1985. "Trends in Labor Force Participation of Spanish Women: An Interpretive Essay," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 3(1), pages S201-17, January.
    13. Gregory, R G & McMahon, P & Whittingham, B, 1985. "Women in the Australian Labor Force: Trends, Causes, and Consequences," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 3(1), pages S293-309, January.
    14. Gustafsson, Siv & Jacobsson, Roger, 1985. "Trends in Female Labor Force Participation in Sweden," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 3(1), pages S256-74, January.
    15. Moulton, Brent R., 1986. "Random group effects and the precision of regression estimates," Journal of Econometrics, Elsevier, Elsevier, vol. 32(3), pages 385-397, August.
    16. Joshi, Heather E & Layard, Richard & Owen, Susan J, 1985. "Why Are More Women Working in Britain?," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 3(1), pages S147-76, January.
    17. Moulton, Brent R, 1987. "Diagnostics for Group Effects in Regression Analysis," Journal of Business & Economic Statistics, American Statistical Association, American Statistical Association, vol. 5(2), pages 275-82, April.
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    Cited by:
    1. Verena Tobsch, 2013. "Betreuung von Schulkindern: ein weiterer Schlüssel zur Aktivierung ungenutzter Arbeitskräftepotenziale?," SOEPpapers on Multidisciplinary Panel Data Research, DIW Berlin, The German Socio-Economic Panel (SOEP) 573, DIW Berlin, The German Socio-Economic Panel (SOEP).
    2. Barbara Hanel & Regina T. Riphahn, 2012. "The Employment of Mothers – Recent Developments and their Determinants in East and West Germany," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 232(2), pages 146-176, March.

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