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Long-term effects of labor market conditions on family formation for Japanese youth

  • Hashimoto, Yuki
  • Kondo, Ayako

This study aims to examine how each cohort’s family formation is affected by labor market conditions experienced in youth in Japan. Although the deterioration in youth employment opportunities has often been blamed for Japan’s declining fertility rate, the effect of slack labor market conditions on fertility is theoretically unclear. We estimate the effects of regional labor market conditions at entry to the labor market and contemporaneous conditions on fertility, controlling for nation-wide year effects and prefecture fixed effects, and find the following. First, high school-educated women who experienced a recession while entering the labor market are less likely to have children. In contrast, a recession rather increases fertility among college-educated women. When summed up, the aggregate impact of labor market conditions experienced in youth on fertility is weak. Second, the unemployment rate at entry to the labor market is positively correlated with the probability of having two or more children conditionally on having at least one child. Third, the contemporaneous unemployment rate is negatively correlated with marriage of women in the local labor market, although the correlation is weak and concentrated on the less educated group.

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Article provided by Elsevier in its journal Journal of the Japanese and International Economies.

Volume (Year): 26 (2012)
Issue (Month): 1 ()
Pages: 1-22

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Handle: RePEc:eee:jjieco:v:26:y:2012:i:1:p:1-22
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  1. Francine D. Blau & Lawrence M. Kahn & Jane Waldfogel, 2000. "Understanding Young Women's Marriage Decisions: The Role of Labor and Marriage Market Conditions," ILR Review, Cornell University, ILR School, vol. 53(4), pages 624-647, July.
  2. Jason M. Lindo, 2010. "Are Children Really Inferior Goods? Evidence from Displacement-Driven Income Shocks," Journal of Human Resources, University of Wisconsin Press, vol. 45(2).
  3. Kazuyasu Sakamoto & Yukinobu Kitamura, 2006. "Sedaikan kankei kara mita kekkon kodo [in Japanese]," Hi-Stat Discussion Paper Series d06-198, Institute of Economic Research, Hitotsubashi University.
  4. Gould, Eric D. & Paserman, M. Daniele, 2003. "Waiting for Mr. Right: rising inequality and declining marriage rates," Journal of Urban Economics, Elsevier, vol. 53(2), pages 257-281, March.
  5. Butz, William P & Ward, Michael P, 1979. "The Emergence of Countercyclical U.S. Fertility," American Economic Review, American Economic Association, vol. 69(3), pages 318-28, June.
  6. Huttunen, Kristiina & Kellokumpu, Jenni, 2012. "The Effect of Job Displacement on Couples' Fertility Decisions," IZA Discussion Papers 6707, Institute for the Study of Labor (IZA).
  7. repec:clu:wpaper:0809-08 is not listed on IDEAS
  8. Yuji Genda & Ayako Kondo & Souichi Ohta, 2010. "Long-Term Effects of a Recession at Labor Market Entry in Japan and the United States," Journal of Human Resources, University of Wisconsin Press, vol. 45(1).
  9. Yoshio Higuchi, 2001. "Women's Employment in Japan and the Timing of Marriage and Childbirth," The Japanese Economic Review, Japanese Economic Association, vol. 52(2), pages 156-184.
  10. HIGUCHI Yoshio & MATSUURA Toshiyuki & SATO Kazuma, 2007. "Impact of Regional Factors on Births and Wives' Continuation in Employment - Panel survey of consumers by the Institute for Research on Household Economics (Japanese)," Discussion Papers (Japanese) 07012, Research Institute of Economy, Trade and Industry (RIETI).
  11. Rajeev Dehejia & Adriana LLeras Muney, 2004. "Booms, Busts, and Babies' Health," The Quarterly Journal of Economics, MIT Press, vol. 119(3), pages 1091-1130, August.
  12. Schultz, T.P., 1993. "Marital Status and Fertility in the United States: Welfare and Labor Market Effects," Papers 703, Yale - Economic Growth Center.
  13. Ermisch, John & Ogawa, Naohiro, 1994. "Age at Motherhood in Japan," Journal of Population Economics, Springer, vol. 7(4), pages 393-420, November.
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