Who cares: Deciphering China's female employment paradox

Haiyue Yu, Jin Cao and Shulong Kang

No 7/2021, BOFIT Discussion Papers from Bank of Finland Institute for Emerging Economies (BOFIT)

Abstract: Female post-childbirth labor market participation and labor intensity are extraordinarily high in China, given that public childcare subsidies are limited and supportive policies for childbearing female employees are largely absent. Establishing a panel dataset that tracks female employment and childbirth, we find that such a paradox is well-explained by the intra-family childcare support provided by grandparents. Correcting the selection bias that stems from women's fertility choices using the propensity score matching difference-in-difference model, we find that women without grandparental support suffer a substantial drop in post-childbirth employment, while women with grandparental support even experience a rise in employment after childbirth. It takes women without grandparental support twice as long to recover their employment after childbirth. Finally, we find that childbirth does not decrease women's labor intensity due to a lack of labor market flexibility, and that women face a stay-or-quit dilemma when grandparental childcare support is absent.

Keywords: Financial frictions; management practices; CO2 emissions; energy efficiencygrandparental childcare; PSM-DID; fertility choice; female employment; labor intensity (search for similar items in EconPapers)
JEL-codes: C24 J13 J22 (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-cna and nep-dem
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:bofitp:bdp2021_007

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