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The Effect of Child Care and Part Time Opportunities on Participation and Fertility Decisions in Italy

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  • Del Boca, Daniela

    ()
    (University of Turin)

Abstract

Economic models of household behavior typically yield the prediction that increases in schooling levels and wage rates of married women lead to increases in their labor supply and reductions in fertility. In Italy, as well as in other Southern European countries, low labor market participation rates of married women are observed together with low birth rates. Our proposed explanation for this apparent anomaly involves the Italian institutional structure, particularly as reflected in rigidities and imperfections in the labor market and characteristics of the publicly-funded child care system. These rigidities tend to simultaneously increase the costs of having children and to discourage the labor market participation of married women. We analyze a model of labor supply and fertility, using panel data from the Bank of Italy which have been merged with regional data describing the available opportunities in each sample household’s environment. The empirical results show that the availability of child care and part time work increase both the probability of working and having a child. Policies which would provide more flexible working hours choices and greater child care availability would aid in reducing the financial burden of children.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 427.

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Length: 37 pages
Date of creation: Feb 2002
Date of revision:
Publication status: published in: Journal of Population Economics, 2002, 15 (3), 549–573
Handle: RePEc:iza:izadps:dp427

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Keywords: Labor market decisions; fertility; child care;

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  1. Danièle Meulders & Olivier Plasman & Robert Plasman, 1994. "Atypical employment in the EC," ULB Institutional Repository 2013/13464, ULB -- Universite Libre de Bruxelles.
  2. Chamberlain, Gary, 1980. "Analysis of Covariance with Qualitative Data," Review of Economic Studies, Wiley Blackwell, vol. 47(1), pages 225-38, January.
  3. 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.
  4. Christopher J. Mayer & Gary V. Engelhardt, 1994. "Gifts, down payments, and housing affordability," Working Papers 94-5, Federal Reserve Bank of Boston.
  5. Ermisch, John F, 1989. "Purchased Child Care, Optimal Family Size and Mother's Employment: Theory and Econometric Analysis," Journal of Population Economics, Springer, vol. 2(2), pages 79-102.
  6. Cigno, Alessandro & C. Giannelli, Gianna & Rosati, Furio C., 1998. "Voluntary transfers among Italian households: altruistic and non-altruistic explanations," Structural Change and Economic Dynamics, Elsevier, vol. 9(4), pages 435-451, December.
  7. Connelly, Rachel, 1992. "The Effect of Child Care Costs on Married Women's Labor Force Participation," The Review of Economics and Statistics, MIT Press, vol. 74(1), pages 83-90, February.
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