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Culture as Learning: The Evolution of Female Labor Force Participation over a Century

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Author Info
Raquel Fernandez

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Abstract

Married women's labor force participation has increased dramatically over the last century. Why this has occurred has been the subject of much debate. This paper investigates the role of culture as learning in this change. To do so, it develops a dynamic model of culture in which individuals hold heterogeneous beliefs regarding the relative long-run payoffs for women who work in the market versus the home. These beliefs evolve rationally via an intergenerational learning process. Women are assumed to learn about the long-term payoffs of working by observing (noisy) private and public signals. They then make a work decision. This process generically generates an S-shaped figure for female labor force participation, which is what is found in the data. The S shape results from the dynamics of learning. I calibrate the model to several key statistics and show that it does a good job in replicating the quantitative evolution of female LFP in the US over the last 120 years. The model highlights a new dynamic role for changes in wages via their effect on intergenerational learning. The calibration shows that this role was quantitatively important in several decades.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 13373.

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Date of creation: Sep 2007
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Handle: RePEc:nbr:nberwo:13373

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Find related papers by JEL classification:
E2 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment
J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
Z1 - Other Special Topics - - Cultural Economics

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References listed on IDEAS
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Guido Tabellini & Mariaflavia Harari, 2009. "The Effect of Culture on the Functioning of Institutions: Evidence from European Regions," CESifo DICE Report, Ifo Institute for Economic Research at the University of Munich, vol. 7(1), pages 13-19, 04. [Downloadable!]
  2. Lídia Farré & Francis Vella, 2007. "The Intergenerational Transmission of Gender Role Attitudes and its Implications for Female Labor Force Participation," IZA Discussion Papers 2802, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  3. Hanno Lustig & Stijn Van Nieuwerburg & Adrien Verdelhan, 2007. "The Wealth-Consumption Ratio: A Litmus Test for Consumption-based Asset Pricing Models¤," Boston University - Department of Economics - Working Papers Series WP2007-030, Boston University - Department of Economics. [Downloadable!]
  4. Alessandra Fogli & Laura Veldkamp, 2008. "Nature or Nurture? Learning and the Geography of Female Labor Force Participation," NBER Working Papers 14097, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  5. Guido Tabellini, 2007. "Institutions and Culture," Working Papers 330, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University. [Downloadable!]
  6. Almut Balleer & Ramon Gomez-Salvador & Jarkko Turunen, 2009. "Labour Force Participation in the Euro Area: A Cohort Based Analysis," Working Paper Series 1049, European Central Bank. [Downloadable!]
  7. Rob Euwals & Marike Knoef & Daniel van Vuuren, 2007. "The Trend in Female Labour Force Participation: What Can Be Expected for the Future?," IZA Discussion Papers 3225, Institute for the Study of Labor (IZA). [Downloadable!]
  8. Rob Euwals & Marike Knoef & Daniel van Vuuren, 2007. "The trend in female labour force participation," CPB Discussion Papers 93, CPB Netherlands Bureau for Economic Policy Analysis. [Downloadable!]
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