Working Paper: CEPR ID: DP6324
Authors: Alessandra Fogli; Laura Veldkamp
Abstract: Much of the increase in female labour force participation in the post-war period has come from the entry of married women with young children. Accompanying this change has been a rise in cultural acceptance of maternal employment. We argue that the concurrent S shaped rise in maternal participation and its cultural acceptance comes from generations of women engaged in Bayesian learning about the effects of maternal employment on children. Each generation updates their parents' beliefs by observing the children of employed women. When few women participate in the labour force, most observations are uninformative and participation rises slowly. As information accumulates and the effects of labour force participation become less uncertain, more women participate, learning accelerates and labour force participation rises faster. As beliefs converge to the truth, participation flattens out. Survey data, wage data and participation data support our mechanism and distinguish it from alternative explanations.
Keywords: female labour force participation; information diffusion; labour supply; preference transmission; S-shaped learning
JEL Codes: E2; J21; N32; Z1
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Maternal employment (J22) | Cultural acceptance of women's labor force participation (J29) |
| Cultural beliefs (Z10) | Female labor force participation (J21) |
| Maternal employment (J22) | Female labor force participation (J21) |
| Uncertainty about maternal employment's impact on children decreases over time (J29) | Female labor force participation increases (J21) |