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Postponed childbearing improves women’s labor
market outcomes but may reduce overall fertility
The rise in the average age of women bearing
their first child is a well-established demographic trend in recent decades.
Postponed childbearing can have important consequences for the mothers and,
at a macro level, for the country in which they live. Research has primarily
focused on the effect postponing fertility has on mothers’ labor market
outcomes and on the total number of children a woman has in her lifetime.
Most research finds that postponing the first birth raises a mother's labor
force participation and wages but may have negative effects on overall
fertility, especially in the absence of supportive family-friendly
policies.
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Gender inequalities in daily time allocation may
have detrimental effects on earnings and well-being
Many countries experience gender differences, of
various magnitudes, in the time devoted to paid work (e.g. market work time)
and unpaid work (e.g. housework and childcare). Since household
responsibilities influence the participation of women, especially mothers,
in the labor market, the unequal sharing of unpaid work, with women bearing
the brunt of housework and childcare, is one of the main drivers of gender
inequality in the labor market. Understanding the factors behind these
gender inequalities is crucial for constructing policies aimed at promoting
gender equality and combating gender-based discrimination.
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Parental leave increases the family–work
balance, but prolonged leave may have negative impacts on mothers’
careers
Numerous studies have investigated whether the
provision and generosity of parental leave affects the employment and career
prospects of women. Parental leave systems typically provide either short
unpaid leave mandated by the firm, as in the US, or more generous and
universal leave mandated by the government, as in Canada and several
European countries. Key economic policy questions include whether, at the
macro level, female employment rates have increased due to parental leave
policies; and, at the micro level, whether the probability of returning to
work and career prospects have increased for mothers after childbirth.
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Policies to reduce fertility in developing
countries generally boost education levels, but only slightly
At the national level, it has long been observed
that a country's average education level is negatively associated with its
total fertility rate. At the household level, it has also been well
documented that children's education is negatively associated with the
number of children in the family. Do these observations imply a causal
relationship between the number of children and the average education level
(the quantity–quality trade-off)? A clear answer to this question will help
both policymakers and researchers evaluate the total benefit of family
planning policies, both policies to lower fertility and policies to boost
it.
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The evidence, though weak, favors legal, easy,
unilateral divorce
Many countries have enacted legislation over the
past few decades making divorce easier. Some countries have legalized
divorce where it had previously been banned, and many have eased the
conditions required for a divorce, such as allowing unilateral divorce (both
spouses do not have to agree on the divorce). Divorce laws can regulate the
grounds for divorce, division of property, child custody, and child support
or maintenance payments. Reforms can have a range of social effects beyond
increasing the divorce rate. They can influence female labor supply,
marriage and fertility rates, child well-being, household saving, and even
domestic violence and crime.
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Boosting the efficiency of household production
could have large economic effects
The time household members in industrialized
countries spend on housework and shopping is substantial, amounting to about
half as much as is spent on paid employment. Women bear the brunt of this
burden, driven in part by the gender wage differential. Efforts to reduce
the gender wage gap and alter gendered norms of behavior should reduce the
gender bias in household production time and reduce inefficiency in home
production. Policymakers should also note the impact of tax policy on
housework time and its market substitutes, and consider ways to reduce the
distortions caused by sales and income taxes.
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Better educated parents invest more time and
money in their children, who are more successful in the labor market
Governments invest a lot of money in education,
so it is important to understand the benefits of this spending. One
essential aspect is that education can potentially make people better
parents and thus improve the educational and employment outcomes of their
children. Interventions that encourage the educational attainment of
children from poorer families will reduce inequality in current and future
generations. In addition to purely formal education, much less expensive
interventions to improve parenting skills, such as parental involvement
programs in schools, may also improve child development.
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Public education tends to crowd out parents’
time and money, but careful policy design may mitigate this
Many countries around the world are making
substantial and increasing public investments in children by providing
resources for schooling from early years through to adolescence. Recent
research has looked at how parents respond to children’s schooling
opportunities, highlighting that public inputs can alternatively encourage
or crowd out parental inputs. Most evidence finds that parents reduce their
own efforts as schooling improves, dampening the efficiency of government
expenditure. Policymakers may thus want to focus government provision on
schooling inputs that are less easily substituted.
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Measures of intergenerational persistence can be
indicative of equality of opportunity, but the relationship is not
clear-cut
A strong association between incomes across
generations—with children from poor families likely to be poor as adults—is
frequently considered an indicator of insufficient equality of opportunity.
Studies of such “intergenerational persistence,” or lack of
intergenerational mobility, measure the strength of the relationship between
parents’ socio-economic status and that of their children as adults.
However, the association between equality of opportunity and common measures
of intergenerational persistence is not as clear-cut as is often assumed. To
aid interpretation researchers often compare measures across time and space
but must recognize that reliable measurement requires overcoming important
data and methodological difficulties.
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A mix of policies could be the solution to
reducing discrimination in the labor market
Discrimination is a complex, multi-factor
phenomenon. Evidence shows widespread discrimination on various grounds,
including ethnic origin, sexual orientation, gender identity, religion or
beliefs, disability, being over 55 years old, or being a woman. Combating
discrimination requires combining the strengths of a range of
anti-discrimination policies while also addressing their weaknesses. In
particular, policymakers should thoroughly address prejudice (taste-based
discrimination), stereotypes (statistical discrimination), cognitive biases,
and attention-based discrimination.
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