Scandinavian Working Papers in Economics

Working Paper Series,
IFAU - Institute for Evaluation of Labour Market and Education Policy

No 2017:13: The effect of fertility timing on labor market work duration

Nikolay Angelov (), Per Johansson () and Myoung-jae Lee ()
Additional contact information
Nikolay Angelov: UCLS – Uppsala Center for Labour Studies, Postal: Uppsala, Sweden
Per Johansson: Uppsala universitet, IFAU, IZA, Postal: Uppsala, Sweden
Myoung-jae Lee: Department of Economics, Korea University, Postal: Seoul, Korea

Abstract: We provide a framework for the estimation of the impact of fertility timing on female long-term labor supply, measured as labor market work duration. We show that the genuine treatment is waiting time to birth rather than birth per se. In the application we control for the joint decision of fertility and labor supply by using the ‘same-sex’ instrument in a control function setting. We find that having a third child will in general reduce the labor market work duration. The magnitude of the effect depends to a large extent on the mothers’ age at second birth but also on the waiting time to the third child and the education level.

Keywords: Labor supply; Parenthood; Retirement; Dynamic treatment assignment; Censored regression

JEL-codes: C24; C26; C51; J22

44 pages, August 18, 2017

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