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Fertility, household structure, and parental labor supply: Evidence from China

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  • Guo, Rufei
  • Li, Hongbin
  • Yi, Junjian
  • Zhang, Junsen

Abstract

This study examines the effects of fertility on household structure and parental labor supply in China. To solve the endogeneity problem, we use a unique survey on households with twin children and a comparison group of non-twin households. The ordinary least squares estimates show a negative correlation between fertility and parental labor supply in rural China. Using twinning as a natural experiment, we do not find evidence on the negative effects of fertility on parental labor supply. By contrast, we find that the twinning-induced increase in fertility significantly enhances the coresidence of grandparents in rural China. We suggest that the negative effects of fertility on parental labor supply are mitigated by the childcare provided by grandparents in rural China. We also find that fertility does not induce coresidence of grandparents in urban China. Our results have important implications for population and public childcare policies.

Suggested Citation

  • Guo, Rufei & Li, Hongbin & Yi, Junjian & Zhang, Junsen, 2018. "Fertility, household structure, and parental labor supply: Evidence from China," Journal of Comparative Economics, Elsevier, vol. 46(1), pages 145-156.
    • Handle: RePEc:eee:jcecon:v:46:y:2018:i:1:p:145-156
    DOI: 10.1016/j.jce.2017.10.005
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    3. Lucie Giorgi & Eva Raiber, 2024. "For better or for babies: The effect of the two-child policy in China on who gets married," French Stata Users' Group Meetings 2024 13, Stata Users Group.
    4. Pauline Rossi & Yun Xiao, 2024. "Spillovers in Childbearing Decisions and Fertility Transitions: Evidence from China," Journal of the European Economic Association, European Economic Association, vol. 22(1), pages 161-199.
    5. Chu, Yu-Wei Luke & Cuffe, Harold E & Doan, Nguyen, 2021. "Motherhood Employment Penalty and Gender Wage Gap Across Countries: 1990–2010," Working Paper Series 9446, Victoria University of Wellington, School of Economics and Finance.
    6. Meng, Lina & Peng, Lu & Zhou, Yinggang, 2023. "Do housing booms reduce fertility intentions? Evidence from the new two-child policy in China," Regional Science and Urban Economics, Elsevier, vol. 101(C).
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    8. Raiber, Eva, 2021. "Anticipated Children and Educational Investment: Evidence from the One-Child Policy in China," VfS Annual Conference 2021 (Virtual Conference): Climate Economics 242401, Verein für Socialpolitik / German Economic Association.
    9. Chae, Minhee & Meng, Xin & Xue, Sen, 2023. "Fertility, Son-Preference, and the Reversal of the Gender Gap in Literacy/Numeracy Tests," IZA Discussion Papers 16208, Institute of Labor Economics (IZA).
    10. Rao, Ziwei, 2021. "Do children prevent their poor old parents from working?," VfS Annual Conference 2021 (Virtual Conference): Climate Economics 242424, Verein für Socialpolitik / German Economic Association.
    11. Arjun Bedi & Tanmoy Majilla & Matthias Rieger, 2022. "Does signaling childcare support on job applications reduce the motherhood penalty?," Review of Economics of the Household, Springer, vol. 20(2), pages 373-387, June.
    12. Meng, Lingsheng & Zhang, Yunbin & Zou, Ben, 2023. "The motherhood penalty in China: Magnitudes, trends, and the role of grandparenting," Journal of Comparative Economics, Elsevier, vol. 51(1), pages 105-132.
    13. Aolin Leng & Fuli Kang, 2022. "Impact of two-child policy on female employment and corporate performance: Empirical evidence from Chinese listed companies from 2010 to 2020," Palgrave Communications, Palgrave Macmillan, vol. 9(1), pages 1-13, December.
    14. Chen, Cheng & Zhao, Wangyang & Chou, Shin-Yi & Lien, Hsien-Ming, 2021. "The effect of family size on parents' labor supply and occupational prestige: Evidence from Taiwan and Mainland China," China Economic Review, Elsevier, vol. 66(C).
    15. Senhu Wang & Yi Wang & Yang Shen, 2023. "The Impact of Supportive Housing Policy Scenarios on Marriage and Fertility Intentions: A Vignette Survey Experimental Study in Shanghai, China," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 42(6), pages 1-25, December.
    16. Joseph Boniface Ajefu, 2019. "Does having children affect women’s entrepreneurship decision? Evidence from Nigeria," Review of Economics of the Household, Springer, vol. 17(3), pages 843-860, September.
    17. Chen, Shuyang, 2024. "Fertility rate, fertility policy, and climate policy: A case study in China," Structural Change and Economic Dynamics, Elsevier, vol. 69(C), pages 339-348.
    18. Öberg, Stefan, 2018. "Instrumental variables based on twin births are by definition not valid (v.3.0)," SocArXiv zux9s, Center for Open Science.
    19. Wu, Xiaoyu, 2022. "Fertility and maternal labor supply: Evidence from the new two-child policies in urban China," Journal of Comparative Economics, Elsevier, vol. 50(2), pages 584-598.
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    More about this item

    Keywords

    Fertility; Parental labor supply; Household structure;
    All these keywords.

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General

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