Working Paper: NBER ID: w1362
Authors: Tadashi Yamada; Tetsuji Yamada
Abstract: A strong and negative correlation between married women's labor force participation and fertility has been witnessed in Japan in past decades. Relative to empirical studies of a traditional single equation on female labor supply, there exist few econometric studies dealing explicitly witha possible interdependency between married women's labor supply and fertility behaviors in urban Japan. Using the recently published 1980 Population Census of Japan, we have estimated a simultaneous-equation model of married women's labor force participation and fertility in urban Japan. Our model shows very satisfactory results to explain the negative correlation between those variables based on a method of 2SLS. Estimated labor supply elasticities for married women with respect to their fertility rates, wife's labor earnings, and male labor earnings are -0.67, 0.23, and -1.76 at the sample means, respectively. On the other hand, estimated elasticities of fertility with respect to married women's labor force participation and family income are -0.31 and 0.23, respectively. We find some of these elasticities for Japanese married women very comparable to those of married women in the United States.
Keywords: labor force participation; fertility; urban Japan; simultaneous equations; 2SLS estimation
JEL Codes: J13; J22
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| increased labor supply among married women (J49) | decreased fertility rates (J13) |
| wife's income (J31) | increased labor supply (J20) |
| family income (D31) | increased labor supply (J20) |
| availability of childcare facilities (J13) | increased labor supply (J20) |
| fertility (J13) | labor supply (J20) |