The Long-Term Effects of Labor Market Restrictions on Women’s Cognitive Aging

This study examines the causal effect of labor market restrictions faced by women in early adulthood on later-life cognitive functioning. To identify this effect, we exploit an exogenous policy change in the Netherlands that removed restrictions on married women's access to paid employment in 1957. Our study draws on data from the Longitudinal Aging Study Amsterdam, an ongoing cohort study of older individuals. We focus on individuals aged 75 and older born between 1928 and 1947. We first examine how work restrictions in early adulthood shape lifetime employment. Next, we assess how these work restrictions affect women’s later-life cognitive outcomes exploiting an exogenous change in labor restriction laws and complement this with an instrumental variables approach. The estimation results indicate that restricted access to paid employment for women in early adulthood reduced labor force participation and occupational prestige over the life course. These reduced labor market opportunities, in turn, led to poorer cognitive functioning after age 75. We also find some suggestive evidence that these restrictions resulted in faster cognitive decline. Taken together, our findings indicate that restrictions on women’s access to paid employment adversely affect cognitive functioning, thereby contributing to cognitive disparities between men and women in later life. More broadly, they highlight the long-term cognitive benefits of sustained labor market engagement and cognitively stimulating work, with potential implications for dementia prevention.