Unanticipated Effects of California's Paid Family Leave Program

25 Pages Posted: 15 Mar 2014

See all articles by Tirthatanmoy Das

Tirthatanmoy Das

Temple University; University of Central Florida - College of Business Administration - Department of Economics; IZA

Solomon W. Polachek

State University of New York at Binghamton; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Abstract

We examine the effect of California Paid Family Leave (CPFL) on young women's (less than 42 years of age) labor force participation and unemployment. CPFL enables workers to take at most six weeks of paid leave over a 12 month period in order to bond with new born or adopted children, or to care for sick family members or ailing parents. The policy benefits women, especially young women, since they are more prone to take such a leave. However, the effect of the policy on labor market outcomes is less clear. We apply difference-in-difference techniques to identify the effects of the CPFL legislation on young women's labor force participation and unemployment.We find that the labor force participation rate, the unemployment rate, and the duration of unemployment among young women rose in California compared to states that did not adopt paid family leave. The latter two findings regarding higher young women's unemployment and unemployment duration are unanticipated effects of the CPFL program. We utilize a unique placebo test to validate the robustness of these results.

Keywords: paid family leave, maternity leave, unemployment, policy evaluation

JEL Classification: H43, J13, J18, J48

Suggested Citation

Das, Tirthatanmoy and Polachek, Solomon W., Unanticipated Effects of California's Paid Family Leave Program. IZA Discussion Paper No. 8023, Available at SSRN: https://ssrn.com/abstract=2409545

Tirthatanmoy Das (Contact Author)

Temple University

No Address Available

University of Central Florida - College of Business Administration - Department of Economics ( email )

Orlando, FL 32816-1400
United States

IZA ( email )

Solomon W. Polachek

State University of New York at Binghamton ( email )

Binghamton, NY 13902-6000
United States
607-777-2144 (Phone)
607-777-4900 (Fax)

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

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