Nature or Nurture? Learning and Female Labor Force Dynamics

Leonard N. Stern Econonics Working Paper

39 Pages Posted: 17 May 2007

See all articles by Alessandra Fogli

Alessandra Fogli

Leonard N. Stern School of Business - Department of Economics

Laura Veldkamp

Columbia University - Columbia Business School; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: May 1, 2007

Abstract

Much of the increase in female labor force participation in the post-war period has come from the entry of married women with young children. Accompanying this change has been a rise in cultural acceptance of maternal employment. We argue that the concurrent S-shaped rise in maternal participation and its cultural acceptance is well explained by generations of women engaged in Bayesian learning about the effects of maternal employment on children. Each generation updates their parents' beliefs by observing the children of employed women. When few women participate in the labor force, most observations are uninformative and participation rises slowly. As information accumulates and the effects of labor force participation become less uncertain, more women participate, learning accelerates and labor force participation rises faster. As beliefs converge to the truth, participation flattens out. Survey data, wage data and participation data support our mechanism and distinguish it from alternative explanations.

Keywords: female labor force participation, preference formation, S-shaped learning, labor supply, endogenous information diffusion

JEL Classification: J21, N32, R12, Z13

Suggested Citation

Fogli, Alessandra and Veldkamp, Laura, Nature or Nurture? Learning and Female Labor Force Dynamics (May 1, 2007). Leonard N. Stern Econonics Working Paper, Available at SSRN: https://ssrn.com/abstract=986624 or http://dx.doi.org/10.2139/ssrn.986624

Alessandra Fogli

Leonard N. Stern School of Business - Department of Economics ( email )

269 Mercer Street
New York, NY 10003
United States
212-998-0872 (Phone)

Laura Veldkamp (Contact Author)

Columbia University - Columbia Business School ( email )

3022 Broadway
New York, NY 10027
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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