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Unintended consequences of maternity leave entitlements on female labor market outcomes in China

Hong Liu, Jiaying Li, Hong Song and Xianqiang Zou

Journal of Economic Behavior & Organization, 2024, vol. 228, issue C

Abstract: This study provides the first empirical evidence of the impact of maternity leave entitlements on labor market outcomes for women of childbearing age in urban China. We exploit a reform during which approximately two-thirds of the provinces in China extended their leave entitlements from 2014 to 2016 and employ a triple-difference strategy to deal with the identification. The results suggest unintended effects, as leave entitlement extensions led to a reduction in the likelihood of working, formal employment, and wage for women of childbearing age relative to their counterparts. We further establish that greater reliance on employer liability may be the main mechanism behind the unintended effects, highlighting the importance of payment schemes. This study provides novel evidence and mechanisms for the labor market effect of maternity leave in women of childbearing age and provides new insights for maternity leave related policy designs.

Keywords: Maternity leave policy; Female employment; Social insurance (search for similar items in EconPapers)
JEL-codes: J08 J16 J20 J83 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:228:y:2024:i:c:s0167268124003962

DOI: 10.1016/j.jebo.2024.106782

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