Does Maternity Leave Affect Labor Force Participation and Productivity?
38 Pages Posted: 12 Mar 2018
Date Written: March 8, 2018
This paper evaluates the effects of maternity leave on female and male labor force participation and on overall macroeconomic productivity. We build a comprehensive maternity leave data set for a panel of middle and high-income countries with emerging financial markets. Our data set augments publicly available data on maternity leave with narrative evidence that identifies the exact dates when legislative changes to maternity leave policies were enacted and enforced, which allows us to study both the immediate and the intermediate-term effects of maternity leave. Maternity leave has positive but limited effects on female labor force participation, but it significantly increases male labor force participation. There is some evidence that increases in maternity leave duration decrease productivity in the short run, but there are no significant adverse effects at longer horizons. We also find evidence of substitutability between male and female workers and strong evidence in favor of a nonlinear relationship between GDP per capita and labor force participation.
Keywords: labor force participation, female labor force participation, maternity leave
JEL Classification: J11, J08, J16, E24
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