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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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Author Info
Beate Grundig
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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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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Related research
Keywords: Female labour supply; childcare; logit model; decomposition;

Find related papers by JEL classification:
J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
R23 - Urban, Rural, and Regional Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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  1. Steffen Henzel, 2008. "Learning Trend Inflation – Can Signal Extraction Explain Survey Forecasts?," Ifo Working Paper Series Ifo Working Paper No. 55, Ifo Institute for Economic Research at the University of Munich. [Downloadable!]
  2. Gustafsson, Siv & Jacobsson, Roger, 1985. "Trends in Female Labor Force Participation in Sweden," Journal of Labor Economics, University of Chicago Press, vol. 3(1), pages S256-74, January. [Downloadable!] (restricted)
  3. 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, vol. 3(1), pages S201-17, January. [Downloadable!] (restricted)
  4. 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, vol. 3(1), pages S275-92, January. [Downloadable!] (restricted)
  5. Lundberg, Shelly, 1985. "The Added Worker Effect," Journal of Labor Economics, University of Chicago Press, vol. 3(1), pages 11-37, January. [Downloadable!] (restricted)
  6. 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). [Downloadable!]
  7. Shimada, Haruo & Higuchi, Yoshio, 1985. "An Analysis of Trends in Female Labor Force Participation in Japan," Journal of Labor Economics, University of Chicago Press, vol. 3(1), pages S355-74, January. [Downloadable!] (restricted)
  8. 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. [Downloadable!]
  9. Joshi, Heather E & Layard, Richard & Owen, Susan J, 1985. "Why Are More Women Working in Britain?," Journal of Labor Economics, University of Chicago Press, vol. 3(1), pages S147-76, January. [Downloadable!] (restricted)
  10. Denise Doiron & Guyonne Kalb, 2004. "Demands for Childcare and Household Labour Supply in Australia," Melbourne Institute Working Paper Series wp2004n06, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne. [Downloadable!]
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  11. 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, vol. 3(1), pages S293-309, January. [Downloadable!] (restricted)
  12. Heckman, James J & Macurdy, Thomas E, 1980. "A Life Cycle Model of Female Labour Supply," Review of Economic Studies, Blackwell Publishing, vol. 47(1), pages 47-74, January. [Downloadable!] (restricted)
  13. Moulton, Brent R, 1987. "Diagnostics for Group Effects in Regression Analysis," Journal of Business & Economic Statistics, American Statistical Association, vol. 5(2), pages 275-82, April.
  14. Moulton, Brent R., 1986. "Random group effects and the precision of regression estimates," Journal of Econometrics, Elsevier, vol. 32(3), pages 385-397, August. [Downloadable!] (restricted)
  15. Moulton, Brent R, 1990. "An Illustration of a Pitfall in Estimating the Effects of Aggregate Variables on Micro Unit," The Review of Economics and Statistics, MIT Press, vol. 72(2), pages 334-38, May. [Downloadable!] (restricted)
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