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on Demographic Economics |
| By: | Frodermann, Corinna (Institute for Employment Research (IAB), Nuremberg); Wrohlich, Katharina (DIW Berlin); Zucco, Aline (DIW Berlin) |
| Abstract: | Paid parental leave schemes have been shown to increase women's employment rates but decrease their wages in case of extended leave durations. In view of these potential trade-offs, many countries are discussing the optimal design of parental leave policies. We analyze the impact of a major parental leave reform on mothers' long-term earnings. The 2007 German parental leave reform replaced a means-tested benefit with a more generous earnings-related benefit that is granted for a shorter period of time. Additionally, a "daddy quota" of two months was introduced. To identify the causal effect of this policy on long-run earnings of mothers, we use a difference-in-difference approach that compares labor market outcomes of mothers who gave birth just before and right after the reform and nets out seasonal effects by including the year before. Using administrative social security data, we confirm previous findings and show that the average duration of employment interruptions increased for high-income mothers. Nevertheless, we find a positive long-run effect on earnings for mothers in this group. This effect cannot be explained by changes in working hours, observed characteristics, changes in employer stability or fertility patterns. Descriptive evidence suggests that the stronger involvement of fathers, incentivized by the "daddy months", could have facilitated mothers' re-entry into the labor market and thereby increased earnings. For mothers with low prior-to-birth earnings, however, we do not find any beneficial labor market effects of this parental leave reform. |
| Keywords: | parental leave, wages, labor supply |
| JEL: | H31 J13 J22 J24 J31 |
| Date: | 2020–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12935&r=all |
| By: | Bonnet, Carole; Garbinti, Bertrand; Solaz, Anne |
| Abstract: | Though shared custody arrangements after divorce are more and more frequent in many countries, little is known about their economic consequences for parents. By relaxing family time constraints, does shared custody help divorced mothers return to work more easily? This article analyses to what extent the type of child custody arrangement affects mothers’ labour market behaviours after divorce. Using a large sample of divorcees from an exhaustive French administrative income-tax database, and taking advantage of the huge territorial discrepancies observed in the proportion of shared custody, we correct for the possible endogeneity of shared custody. As it turns out, the probability of being employed is 16 percentage points higher for mothers with shared custody arrangements compared to those having sole physical custody, with huge heterogeneous effects: larger positive effects are observed for previously inactive women, for those belonging to the lowest income quintiles before divorce, for those with a young child, and for those who have three or more children. Shared custody is particularly helpful for women who are far removed from the labour market. |
| Keywords: | divorce; child custody; shared custody; labour supply |
| JEL: | J12 J18 J22 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:103525&r=all |
| By: | Lisette Swart (CPB Netherlands Bureau for Economic Policy Analysis); Wiljan van den Berge (CPB Netherlands Bureau for Economic Policy Analysis); Karen van der Wiel (CPB Netherlands Bureau for Economic Policy Analysis) |
| Abstract: | When children start school, parents save time and/or money. In this paper, we empirically examine the impact of these changes to the family's budget constraint on parents' working hours. Labor supply is theoretically expected to increase for parents who used to spend time taking care of their children, but to decrease for fulltime working parents because of an income effect: child care expenses drop. We show that the effect of additional time dominates the income effect in the Netherlands, where children start school (kindergarten) for approximately 20 hours a week in the month that they turn 4. Using detailed administrative data on all parents, we fi nd that the average mother's hours worked increases by 3% when her youngest child starts going to school. For their partners, who experience a much smaller shock in terms of time, the increase in hours worked is also much smaller at 0.4%. |
| JEL: | J13 J22 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpb:discus:392.rdf&r=all |
| By: | De Paola, Maria (University of Calabria); Nistico, Roberto (University of Naples Federico II); Scoppa, Vincenzo (University of Calabria) |
| Abstract: | We study the effect of a reduction in employment protection on fertility decisions. Using data from the Italian Labor Force Survey for the years 2013-2018, we analyze how the propensity to have a child has been affected by the 2015 Labor Market Reform, the so-called "Jobs Act", which has essentially reduced the employment protection for large-firm employees and leaved largely unchanged that for small-firm ones. We employ a Difference-in-Differences identification strategy and compare the average change over time in fertility decisions of women employed in large firms with the average change experienced by women employed in small firms. We find that women exposed to the reduction in employment protection have a 1.4 percentage point lower probability of having a child than unexposed women. A battery of robustness checks confirms this finding. We document large heterogeneous effects by marital status, parity, geographic areas as well as by the level of education and wage. Our findings help understand the potential unintended consequences that reforms introducing more labor market flexibility have on fertility decisions by increasing insecurity on career prospects. |
| Keywords: | fertility, employment protection legislation, labor market reform, difference-in-differences |
| JEL: | J13 J65 J41 M51 C31 |
| Date: | 2020–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12991&r=all |
| By: | Tongtong Hao; Ruiqi Sun; Trevor Tombe; Xiaodong Zhu |
| Abstract: | Between 2000 and 2015, China's aggregate income quadrupled, its provincial income inequality fell by a third, and its share of employment in agriculture fell by half. Worker migration is central to this transformation, with almost 300 million workers living and working outside their area or sector of hukou registration by 2015. Combining rich individual-level data on worker migration with a spatial general equilibrium model of China's economy, we estimate the reductions in internal migration costs between 2000 and 2015, and quantify the contributions of these cost reductions to economic growth, structural change, and regional income convergence. We find that over the fifteen-year period China's internal migration costs fell by forty-five percent, with the cost of moving from agricultural rural areas to non-agricultural urban ones falling even more. In addition to contributing substantially to growth, these migration cost changes account for the majority of the reallocation of workers out of agriculture and the drop in regional inequality. We compare the effect of migration policy changes with other important economic factors, including changes in trade costs, capital market distortions, average cost of capital, and productivity. While each contributes meaningfully to growth, migration policy is central to China's structural change and regional income convergence. We also find the recent slow-down in aggregate economic growth between 2010 and 2015 is associated with smaller reduction in inter-provincial migration costs and a larger role of capital accumulation. |
| Keywords: | Migration, Structural Change, Regional Income Convergence, China |
| JEL: | E24 J61 O15 O41 O47 R12 R23 |
| Date: | 2020–02–26 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-659&r=all |