Liquidity constraints and family labor participation

Pengpeng Yue, Aslihan Gizem Korkmaz, Zhichao Yin and Haigang Zhou

Journal of the Asia Pacific Economy, 2023, vol. 28, issue 1, 53-74

Abstract: This paper sheds light on the relationship between liquidity constraints experienced by the head of the household (HOH) and their family members’ labor supply. The study, focusing on the spillover effects between financial and labor markets, finds that when the HOH is liquidity constrained, unemployed family members join the labor market. While the overall tendency of family members is to choose self-employment versus salaried employment, the results show a heterogeneous impact on different family members. We find the impact of liquidity constraints to be the strongest on the labor market decisions of the spouses and children. Using the China Household Finance Survey (CHFS), the study contributes to the literature by presenting evidence on intra-household risk-sharing from a big emerging market economy where the family ties are tightly knit.

Date: 2023
References: Add references at CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://hdl.handle.net/10.1080/13547860.2020.1864102 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:rjapxx:v:28:y:2023:i:1:p:53-74

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/rjap20

DOI: 10.1080/13547860.2020.1864102

Access Statistics for this article

Journal of the Asia Pacific Economy is currently edited by Leong Liew

More articles in Journal of the Asia Pacific Economy from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().