Fertility and Parental Labor-Force Participation: New Evidence from a Developing Country in the Balkans

Iva Trako
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Iva Trako: PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PSE - Paris-Jourdan Sciences Economiques - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique

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Abstract: This paper examines the effect of fertility on parental labor-force participation in a developing country. In order to address the potential endogeneity in the fertility decision, I exploit Albanian parental preference for having sons as an exogenous source of variation. Using a repeated cross-section, I find that having an additional child has a positive and statistically significant effect on parental labor-force participation. IV estimates for mothers show that they increase labor supply, especially in terms of hours worked per week and the likelihood of working off-farm. Similarly, father's likelihood of working off-farm and having a second occupation increase as a consequence of further childbearing. The heterogeneity analysis suggests that this positive effect might be the result of two plausible mechanisms: childcare provided by non-parental adults in extended families and greater financial costs of feeding more children.

Keywords: fertility; parental labor-force participation; instrumental variables (search for similar items in EconPapers)
Date: 2016-09
New Economics Papers: this item is included in nep-dev
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-01361443v1
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