IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp4074.html
   My bibliography  Save this paper

The Effect of Children on the Level of Labor Market Involvement of Married Women: What is the Role of Education?

Author

Listed:
  • Troske, Kenneth

    (University of Kentucky)

  • Voicu, Alexandru

    (CUNY - College of Staten Island)

Abstract

We analyze the way women's education influences the effect of children on their level of labor market involvement. We propose an econometric model that accounts for the endogeneity of labor market and fertility decisions, for the heterogeneity of the effects of children and their correlation with the fertility decisions, and for the correlation of sequential labor market decisions. We estimate the model using panel data from NLSY79. Our results show that women with higher education work more before the birth of the first child, but children have larger negative effects on their level of labor market involvement. Differences across education levels are more pronounced with respect to full time employment than with respect to participation. Other things equal, higher wages reduce the effect of children on labor supply. Controlling for wages, women with higher education face larger negative effects of children on labor supply, which suggest they are characterized by a combination of higher marginal product of time spent in the production of child quality and higher marginal product of time relative to the marginal product of other inputs into the production of child quality.

Suggested Citation

  • Troske, Kenneth & Voicu, Alexandru, 2009. "The Effect of Children on the Level of Labor Market Involvement of Married Women: What is the Role of Education?," IZA Discussion Papers 4074, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp4074
    as

    Download full text from publisher

    File URL: https://docs.iza.org/dp4074.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Rosenzweig, Mark R & Wolpin, Kenneth I, 1980. "Life-Cycle Labor Supply and Fertility: Causal Inferences from Household Models," Journal of Political Economy, University of Chicago Press, vol. 88(2), pages 328-348, April.
    2. Geweke, John, 1989. "Bayesian Inference in Econometric Models Using Monte Carlo Integration," Econometrica, Econometric Society, vol. 57(6), pages 1317-1339, November.
    3. Keane, Michael P, 1994. "A Computationally Practical Simulation Estimator for Panel Data," Econometrica, Econometric Society, vol. 62(1), pages 95-116, January.
    4. Jacob Mincer & Solomon Polachek, 1974. "Family Investments in Human Capital: Earnings of Women," NBER Chapters, in: Marriage, Family, Human Capital, and Fertility, pages 76-110, National Bureau of Economic Research, Inc.
    5. Ondrich, Jan & Spiess, C Katharina & Yang, Qing, 1996. "Barefoot and in a German Kitchen: Federal Parental Leave and Benefit Policy and the Return to Work after Childbirth in Germany," Journal of Population Economics, Springer;European Society for Population Economics, vol. 9(3), pages 247-266, August.
    6. Jacob Mincer & Solomon Polachek, 1978. "An Exchange: The Theory of Human Capital and the Earnings of Women: Women's Earnings Reexamined," Journal of Human Resources, University of Wisconsin Press, vol. 13(1), pages 118-134.
    7. Marit RÃnsen & Marianne SundstrÃm, 1996. "Maternal employment in Scandinavia: A comparison of the after-birth employment activity of Norwegian and Swedish women," Journal of Population Economics, Springer;European Society for Population Economics, vol. 9(3), pages 267-285.
    8. Gronau, Reuben, 1977. "Leisure, Home Production, and Work-The Theory of the Allocation of Time Revisited," Journal of Political Economy, University of Chicago Press, vol. 85(6), pages 1099-1123, December.
    9. Michael, Robert T, 1973. "Education and the Derived Demand for Children," Journal of Political Economy, University of Chicago Press, vol. 81(2), pages 128-164, Part II, .
    10. Dean R. Hyslop, 1999. "State Dependence, Serial Correlation and Heterogeneity in Intertemporal Labor Force Participation of Married Women," Econometrica, Econometric Society, vol. 67(6), pages 1255-1294, November.
    11. John Geweke & Michael P. Keane, 1996. "Bayesian inference for dynamic choice models without the need for dynamic programming," Working Papers 564, Federal Reserve Bank of Minneapolis.
    12. Christopher J. Ruhm, 2004. "Parental Employment and Child Cognitive Development," Journal of Human Resources, University of Wisconsin Press, vol. 39(1).
    13. Carrasco, Raquel, 2001. "Binary Choice with Binary Endogenous Regressors in Panel Data: Estimating the Effect of Fertility on Female Labor Participation," Journal of Business & Economic Statistics, American Statistical Association, vol. 19(4), pages 385-394, October.
    14. Browning, Martin, 1992. "Children and Household Economic Behavior," Journal of Economic Literature, American Economic Association, vol. 30(3), pages 1434-1475, September.
    15. William Axinn & Marin Clarkberg & Arland Thornton, 1994. "Family influences on family size preferences," Demography, Springer;Population Association of America (PAA), vol. 31(1), pages 65-79, February.
    16. Francine D. Blau, 1998. "Trends in the Well-Being of American Women, 1970-1995," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 112-165, March.
    17. C. Russell Hill & Frank P. Stafford, 1980. "Parental Care of Children: Time Diary Estimates of Quantity, Predictability, and Variety," Journal of Human Resources, University of Wisconsin Press, vol. 15(2), pages 219-239.
    18. R. Haurin & Frank Mott, 1990. "Adolescent sexual activity in the family context: The impact of older siblings," Demography, Springer;Population Association of America (PAA), vol. 27(4), pages 537-557, November.
    19. Alice Nakamura & Masao Nakamura, 1994. "Predicting Female Labor Supply: Effects of Children and Recent Work Experience," Journal of Human Resources, University of Wisconsin Press, vol. 29(2), pages 304-327.
    20. Jacob Alex Klerman & Arleen Leibowitz, 1994. "The Work-Employment Distinction among New Mothers," Journal of Human Resources, University of Wisconsin Press, vol. 29(2), pages 277-303.
    21. Angrist, Joshua D & Evans, William N, 1998. "Children and Their Parents' Labor Supply: Evidence from Exogenous Variation in Family Size," American Economic Review, American Economic Association, vol. 88(3), pages 450-477, June.
    22. Gianna Claudia Giannelli, 1996. "Women`s transitions in the labour market: A competing risks analysis on German panel data," Journal of Population Economics, Springer;European Society for Population Economics, vol. 9(3), pages 287-300.
    23. Heckman, James J & Willis, Robert J, 1977. "A Beta-logistic Model for the Analysis of Sequential Labor Force Participation by Married Women," Journal of Political Economy, University of Chicago Press, vol. 85(1), pages 27-58, February.
    24. Geweke, John & Keane, Michael, 2001. "Computationally intensive methods for integration in econometrics," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 56, pages 3463-3568, Elsevier.
    25. Arleen Leibowitz & Jacob Alex Klerman & Linda J. Waite, 1992. "Employment of New Mothers and Child Care Choice: Differences by Children's Age," Journal of Human Resources, University of Wisconsin Press, vol. 27(1), pages 112-133.
    26. Reuben Gronau, 1974. "The Effect of Children on the Housewife's Value of Time," NBER Chapters, in: Economics of the Family: Marriage, Children, and Human Capital, pages 457-490, National Bureau of Economic Research, Inc.
    27. Chib, Siddhartha & Greenberg, Edward, 1995. "Hierarchical analysis of SUR models with extensions to correlated serial errors and time-varying parameter models," Journal of Econometrics, Elsevier, vol. 68(2), pages 339-360, August.
    28. Geweke, John F. & Keane, Michael P. & Runkle, David E., 1997. "Statistical inference in the multinomial multiperiod probit model," Journal of Econometrics, Elsevier, vol. 80(1), pages 125-165, September.
    29. Blank, Rebecca M, 1989. "The Role of Part-Time Work in Women's Labor Market Choices over Time," American Economic Review, American Economic Association, vol. 79(2), pages 295-299, May.
    30. McCulloch, Robert & Rossi, Peter E., 1994. "An exact likelihood analysis of the multinomial probit model," Journal of Econometrics, Elsevier, vol. 64(1-2), pages 207-240.
    31. Jane Waldfogel & Wen-Jui Han & Jeanne Brooks-Gunn, 2002. "The effects of early maternal employment on child cognitive development," Demography, Springer;Population Association of America (PAA), vol. 39(2), pages 369-392, May.
    32. Folbre, Nancy, 1994. "Children as Public Goods," American Economic Review, American Economic Association, vol. 84(2), pages 86-90, May.
    33. Daniel Powers & James Cherng-Tay Hsueh, 1997. "Sibling models of socioeconomic effects on the timing of first premarital birth," Demography, Springer;Population Association of America (PAA), vol. 34(4), pages 493-511, November.
    34. Ronsen, Marit & Sundstrom, Marianne, 1996. "Maternal Employment in Scandinavia: A Comparison of the After-Birth Employment Activity of Norwegian and Swedish Women," Journal of Population Economics, Springer;European Society for Population Economics, vol. 9(3), pages 267-285, August.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Steven F. Koch & Evelyn Thsehla, 2022. "The impact of diabetes on labour market outcomes," Development Southern Africa, Taylor & Francis Journals, vol. 39(3), pages 424-456, May.
    2. Kenneth Troske & Alexandru Voicu, 2013. "The effect of the timing and spacing of births on the level of labor market involvement of married women," Empirical Economics, Springer, vol. 45(1), pages 483-521, August.
    3. Fitzenberger, Bernd & Sommerfeld, Katrin & Steffes, Susanne, 2013. "Causal effects on employment after first birth — A dynamic treatment approach," Labour Economics, Elsevier, vol. 25(C), pages 49-62.
    4. Miguel Jaramillo-Baanante, 2017. "Fertility and women’s work in a demographic transition: evidence from Peru," Working Papers 90, Peruvian Economic Association.
    5. Julio Cáceres-Delpiano, 2012. "Can We Still Learn Something From the Relationship Between Fertility and Mother’s Employment? Evidence From Developing Countries," Demography, Springer;Population Association of America (PAA), vol. 49(1), pages 151-174, February.
    6. Márta K. Radó, 2020. "Tracking the Effects of Parenthood on Subjective Well-Being: Evidence from Hungary," Journal of Happiness Studies, Springer, vol. 21(6), pages 2069-2094, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Troske, Kenneth R. & Voicu, Alexandru, 2010. "Joint estimation of sequential labor force participation and fertility decisions using Markov chain Monte Carlo techniques," Labour Economics, Elsevier, vol. 17(1), pages 150-169, January.
    2. Kenneth Troske & Alexandru Voicu, 2013. "The effect of the timing and spacing of births on the level of labor market involvement of married women," Empirical Economics, Springer, vol. 45(1), pages 483-521, August.
    3. Geweke, J. & Joel Horowitz & Pesaran, M.H., 2006. "Econometrics: A Bird’s Eye View," Cambridge Working Papers in Economics 0655, Faculty of Economics, University of Cambridge.
    4. Prowse, Victoria L., 2005. "State Dependence in a Multi-State Model of Employment Dynamics," IZA Discussion Papers 1623, Institute of Labor Economics (IZA).
    5. Del Boca, Daniela & Sauer, Robert M., 2009. "Life cycle employment and fertility across institutional environments," European Economic Review, Elsevier, vol. 53(3), pages 274-292, April.
    6. Michael Grimm & Noël Bonneuil, 2001. "Labour Market Participation of French Women over the Life Cycle, 1935–1990," European Journal of Population, Springer;European Association for Population Studies, vol. 17(3), pages 235-260, September.
    7. Victoria Prowse, 2005. "State Dependence in a Multi-state Model of Employment," Economics Papers 2005-W20, Economics Group, Nuffield College, University of Oxford.
    8. Tong Li & Xiaoyong Zheng, 2008. "Semiparametric Bayesian inference for dynamic Tobit panel data models with unobserved heterogeneity," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 23(6), pages 699-728.
    9. Zvi Eckstein & Osnat Lifshitz, 2011. "Dynamic Female Labor Supply," Econometrica, Econometric Society, vol. 79(6), pages 1675-1726, November.
    10. Ruhm, Christopher J., 2000. "Parental leave and child health," Journal of Health Economics, Elsevier, vol. 19(6), pages 931-960, November.
    11. Pierre‐Carl Michaud & Konstantinos Tatsiramos, 2011. "Fertility and female employment dynamics in Europe: the effect of using alternative econometric modeling assumptions," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 26(4), pages 641-668, June.
    12. Pierre‐Carl Michaud & Konstantinos Tatsiramos, 2011. "Fertility and female employment dynamics in Europe: the effect of using alternative econometric modeling assumptions," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 26(4), pages 641-668, June.
    13. Miguel Jaramillo-Baanante, 2017. "Fertility and women’s work in a demographic transition: evidence from Peru," Working Papers 90, Peruvian Economic Association.
    14. Kerem Tuzcuoglu, 2019. "Composite Likelihood Estimation of an Autoregressive Panel Probit Model with Random Effects," Staff Working Papers 19-16, Bank of Canada.
    15. Anna Baranowska-Rataj & Anna Matysiak, 2016. "The Causal Effects of the Number of Children on Female Employment - Do European Institutional and Gender Conditions Matter?," Journal of Labor Research, Springer, vol. 37(3), pages 343-367, September.
    16. Julian P. Cristia, 2006. "The Effect of a First Child on Female Labor Supply: Evidence from Women Seeking Fertility Services: Working Paper 2006-11," Working Papers 18233, Congressional Budget Office.
    17. Reuben Gronau, 2003. "Jacob Mincer and Labor Supply–Before and Aftermath," Review of Economics of the Household, Springer, vol. 1(4), pages 319-329, December.
    18. Koop, Gary & Tobias, Justin L., 2006. "Semiparametric Bayesian inference in smooth coefficient models," Journal of Econometrics, Elsevier, vol. 134(1), pages 283-315, September.
    19. Alan L. Gustman & Thomas L. Steinmeier, 1986. "Wages, Employment, Training and Job Attachment in Low Wage Labor Marketsfor Women," NBER Working Papers 2037, National Bureau of Economic Research, Inc.
    20. Djurdjevic, Dragana, 2005. "Women's Labour Supply after Childbirth: An Empirical Analysis for Switzerland," Darmstadt Discussion Papers in Economics 144, Darmstadt University of Technology, Department of Law and Economics.

    More about this item

    Keywords

    female labor supply; education; endogenous fertility decisions; heterogeneous children effects; multinomial probit model; Gibbs sampler;
    All these keywords.

    JEL classification:

    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General
    • C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Statistical Simulation Methods: General
    • 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

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp4074. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Holger Hinte (email available below). General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.