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Stay at Home with Grandma, Mom Is Going to Work: The Impact of Grandmothers’ Retirement on Mothers’ Labor Decisions

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  • María Florencia Pinto

Abstract

Grandparents are an important source of childcare, especially when formal childcare supply is low. In this paper, I explore whether grandmothers’ retirement affects their daughters’ employment when they have young children. I exploit a pension reform in Argentina that induced an arguably exogenous variation in grandmothers’ retirement decisions. I find that mothers of young children coresiding with retirement-eligible grandmothers are significantly more likely to participate in the labor market and to be employed, and the effects are large. Although I find suggestive evidence that the underlying mechanism is an increase in grandmothers’ time availability, I cannot fully rule out an income effect. Also, I find no evidence that the policy affected fertility or household composition.

Suggested Citation

  • María Florencia Pinto, 2023. "Stay at Home with Grandma, Mom Is Going to Work: The Impact of Grandmothers’ Retirement on Mothers’ Labor Decisions," Economic Development and Cultural Change, University of Chicago Press, vol. 72(1), pages 283-327.
  • Handle: RePEc:ucp:ecdecc:doi:10.1086/719161
    DOI: 10.1086/719161
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