Upload
truongkhue
View
219
Download
6
Embed Size (px)
Citation preview
Fertility, Female Labor Force Participation, and the Demographic Dividend
David E. BloomDavid CanningGünther Fink
Jocelyn E. Finlay
Program on the Global Demography of AgingHarvard School of Public Health
Second Annual Research Conference on Population, Reproductive Health, and Economic Development, December 8-9 2007
This research was made possible by Grant Number 5 P30 AG024409 from the National Institute on Aging, National Institutes of Health and by a grant from the William and Flora Hewlett Foundation.
Fertility, Female Labor Force Participation, and the Demographic Dividend 2
Main Questions in this Paper1. How do fertility changes during the demographic transition affect
female labor force participation?2. What are the long run implications for the size of the demographic
dividend?
IdentificationWe identify the effect of fertility using abortion laws as instrument
ResultFertility declines lead to a significant increase in female labor force participation augmenting the demographic dividend
Fertility, Female Labor Force Participation, and the Demographic Dividend 3
Outline
• Introduction and Literature• Data• Empirical Results• Simulations• Conclusion
Fertility, Female Labor Force Participation, and the Demographic Dividend 4
Introduction and Literature Continued
Female Participation Response to Fertility – US state-level studies show that a fall in fertility leads to an increase in
the extent of female labor force participation: Bailey (2006), Cain and Dooley (1976).
Identification Approaches– Accessibility of the contraceptive pill: Bailey, 2006– State level legalization of abortion:
Fertility effect: Levine et al. (1999); Klerman (1999)Education and Participation: Angrist and Evans (1996)
Fertility, Female Labor Force Participation, and the Demographic Dividend 5
Identification
FertilityFemale Labor Force Participation
Abortion Legislation
Fertility, Female Labor Force Participation, and the Demographic Dividend 6
Data
Female Labor Market Participation (ILO 2007)– By cohort (15-19, 20-25,…,60-64)– 1950-2000– 97 countries
Fertility (WDI 2006)– Total fertility rate
Abortion Index (United Nations Population Division 2002)– Combined score of legal abortion on grounds of physical and
mental health of the mother, life-threatening pregnancies, rape, fetal impairment, economic hardship, on request
– Items highly correlated; index very similar to principal component
Fertility, Female Labor Force Participation, and the Demographic Dividend 7
Female Labor Force Participation 1960 and 2000
0
10
20
30
40
50
60
70
15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64
Age Group
Perc
enta
ge P
artic
ipat
ing
1960 2000
Fertility, Female Labor Force Participation, and the Demographic Dividend 8
Empirical Specification
ijt i i jt i jt i jt i jt
f mi jt i jt it ij ij ijt
P Fert Cap Life Urban
Eduf Edum t
α β γ ϕ λ
φ φ δ δ τ ε
= + + + +
+ + + + + +
Pijt female labor force participation of age group i, country j, year t
Fertjt total fertility rate
Capjt capital stock per working age person
Urbanjt population living in urban area (%)
Edufjt average years of schooling for females >15
Edumjt average years of schooling for males >15
Fertility, Female Labor Force Participation, and the Demographic Dividend 9
Female Labor Force Participation (30-34)
2SLS 2SLS, trend 2SLS, trend, lagTotal Fertility Rate -17.056*** -9.815** -7.686*
(5.359) (3.866) (3.975)0.497***(0.083)
Female life expectancy -0.413 0.182 0.165(0.275) (0.142) (0.110)
Capital to Working age population 0.706*** 0.368** 0.201(0.114) (0.153) (0.141)
Urban population (% of total) -0.662*** -0.387** -0.242(0.159) (0.168) (0.202)
Average schooling years, male >15yrs 1.190 1.596 0.728(1.587) (1.193) (1.043)
Average schooling years, female >15yrs -4.508 -3.497** -1.612(3.162) (1.735) (1.483)
Observations 770 770 673R-squared 0.82 0.98 0.99
Fertility, Female Labor Force Participation, and the Demographic Dividend 10
First Stage Results
2SLS 2SLS, trend 2SLS, trend, lagAbortion Index -0.068*** -0.045*** -0.035**
(0.017) (0.016) (0.015)-0.018***(0.004)
Female life expectancy -0.040*** 0.029*** 0.021***(0.009) (0.007) (0.007)
Capital to Working age population 0.022*** 0.035*** 0.032***(0.002) (0.004) (0.004)
Urban population (% of total) -0.019*** -0.036*** -0.045***(0.006) (0.007) (0.008)
Average schooling years, male >15yrs 0.231*** 0.262*** 0.230***(0.059) (0.053) (0.050)
Average schooling years, female >15yrs -0.569*** -0.415*** -0.345***(0.059) (0.058) (0.057)
Observations 770 770 673R-squared 0.96 0.99 0.99Cragg-Donald F-stat 16.34 8.26 5.71
Fertility, Female Labor Force Participation, and the Demographic Dividend 11
Total Dynamic Effect of Fertility Decline
-25.0
-20.0
-15.0
-10.0
-5.0
0.0
5.0
15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64
Age Group
Part
icip
atio
n Ef
fect
Direct Effect Total effect
Fertility, Female Labor Force Participation, and the Demographic Dividend 12
Simulation Framework I
1t t t tY A H Kα α−=• Production Function
• Physical Capital Stock
• Parameterization
1 1(1 )t t tK sY Kδ− −= + −
2 , 0.24, 0.083
0
s
At
α δ= = =
∂=
∂
Fertility, Female Labor Force Participation, and the Demographic Dividend 13
Simulation Framework II
• Demographic Structure
• Labor Force
( )
45
1, 1 1 016
1 1,s s s s fit i t i t s it it
iP P for i P f Pσ λ− − −
=
= − ≥ = ∑
100
0 ,
s st it it
i s m f
L P ρ= =
=∑ ∑
Fertility, Female Labor Force Participation, and the Demographic Dividend 14
Specific Example: South Korea
1960 2000
Fertility (TFR) 5.6 1.2
Life Expectancy at birth
55.2 76.8
Female Labor Market Participation (25-29)
26.3 55.7
Fertility, Female Labor Force Participation, and the Demographic Dividend 15
Results
0
50
100
150
200
250
300
1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100
GD
P In
dex
BaselineSolow Age StructureAge Structure + Female Participation
Fertility, Female Labor Force Participation, and the Demographic Dividend 16
Conclusions
Empirical results suggest that the decline in fertility leads to a significant increase in female labor force participation
This increase in female labor force participation compounds the positive growth effects induced by fertility decline
The magnitude of aging effect depends on the participation behavior of the 65+ age group – the focus of our complementary study
Fertility, Female Labor Force Participation, and the Demographic Dividend 17
Backup Slides
Fertility, Female Labor Force Participation, and the Demographic Dividend 18
Case Study: South Korea
0
10
20
30
40
50
60
70
1960 1965 1970 1975 1980 1985 1990 1995 2000
Parti
cipa
tion
Rat
es
0.0
1.0
2.0
3.0
4.0
5.0
6.0
Tota
l Fer
tility
Rat
e
Total Fertility Rate
Female Labor Market ParticipationAges Group 25-39
Female Labor Market ParticipationAges 40-54
January 1973: Liberalization of abortion
Since 1953: Abortion prohibited on any ground.
Fertility, Female Labor Force Participation, and the Demographic Dividend 19
Korea: Demographics and Workers per Capita
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100 21100
0.1
0.2
0.3
0.4
0.5
0.6
Age 65+ per working age
Age 0-14 per working Age
Working Age Persons per Capita
Workers per Capita (right hand scale)
Fertility, Female Labor Force Participation, and the Demographic Dividend 20
Population Forecast: Low Fertility Scenario
0
10
20
30
40
50
60
1970 1980 1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100
Pop
ulat
ion,
Milli
ons
Actual Population
Simulated Population
Fertility, Female Labor Force Participation, and the Demographic Dividend 21
Actual versus Simulated Age Structure
0%
5%
10%
15%
20%
25%
0-4 5-9 10-14 15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65-69 70-74 75-79 80+
Age Group
Population Share
Actual Age Structure 1960Simulated Age Structure 1960