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Provision of Child Care and Female Labor Supply: Evidence from Japanese Household Level Data(in Japanese)

Satoshi Shimizutani and Haruko Noguchi

ESRI Discussion paper series from Economic and Social Research Institute (ESRI)

Abstract: An increase in female labor force participation is indispensable to maintain sustainable economic growth in Japan, whose population is experiencing rapid aging and a decline in fertility. One remedy to these problems that is often proposed to be effective in stimulating the female labor supply is the provision of sufficient child care services. Surprisingly, however, there has been little micro-level empirical research in Japan on the relationship between child care provision and female labor supply. This study addresses this topic by taking advantage of a unique micro-level data set from households with children under age five in the metropolitan area around Tokyo. Our empirical results demonstrate that labor supply elasticity with respect to parents' payments for child care is estimated to be -0.2. Moreover, the elasticity of labor supply with respect to mother's wage rate is high at 1.4. On the top of these factors, female labor supply is stimulated by provision of child care leave, flexible or short working hours, and child care in the workplace. Our findings imply that a larger amount of labor supply is observed for females with higher wage rates and thus higher productivity, and that sufficient provision of child care services is an effective instrument to increase the labor supply of those female workers. Moreover, price policy for child care and welfare policy for the workplace are also significant aspects of female labor supply.

Pages: 35 pages
Date: 2004-03
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Citations: View citations in EconPapers (1)

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