Joint Estimation of Sequential Labor Force Participation and Fertility Decisions Using Markov Chain Monte Carlo Techniques

59 Pages Posted: 13 Aug 2004

See all articles by Kenneth R. Troske

Kenneth R. Troske

University of Kentucky - Department of Economics; University of Missouri at Columbia - Department of Economics; IZA Institute of Labor Economics

Alexandru Voicu

City University of New York (CUNY) - College of Staten Island; IZA Institute of Labor Economics

Date Written: August 2004

Abstract

In this paper we estimate the causal effect of children on the labor supply of women using panel data on women from the 1979 National Longitudinal Survey of Youth (NLSY79). We examine the effect of children both prior to and after birth as well as how the effect of children varies with the number of children. We also decompose the total effect of children into the direct and indirect components and separately examine the dynamics of these components. Sequential participation decisions for four levels of labor market involvement and fertility decisions are jointly modeled. We allow decisions to be correlated in a general fashion both across time and across choices. The estimation is performed using Markov chain Monte Carlo methods. We find that children have a strong effect on a women's labor market behavior in both the pre- and post-birth period. We also find that both the direct and indirect effects are large immediately after the birth of a child but that the indirect effect declines quickly over time. The effects of children vary by education and race.

Keywords: female labor supply, multivariate probit model, Gibbs sampler

JEL Classification: C11, C15, J13, J22

Suggested Citation

Troske, Kenneth R. and Voicu, Alexandru, Joint Estimation of Sequential Labor Force Participation and Fertility Decisions Using Markov Chain Monte Carlo Techniques (August 2004). IZA Discussion Paper No. 1251, Available at SSRN: https://ssrn.com/abstract=576082

Kenneth R. Troske (Contact Author)

University of Kentucky - Department of Economics ( email )

Lexington, KY 40506
United States

University of Missouri at Columbia - Department of Economics ( email )

118 Professional Building
Columbia, MO 65211
United States
573-882-4229 (Phone)
573-882-2697 (Fax)

IZA Institute of Labor Economics

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

Alexandru Voicu

City University of New York (CUNY) - College of Staten Island ( email )

NY
United States
718-982-2899 (Phone)

HOME PAGE: http://www.library.csi.cuny.edu/~pep/voicu.htm

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany
+49 228 38 94 527 (Phone)
+49 228 38 94 510 (Fax)

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