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Reconsidering the impact of family size on labour supply: The twin-problems of the twin-birth instrument

Author

Listed:
  • Nils Braakmann

    (Newcastle University, Business School – Economics, UK)

  • John Wildman

    (Newcastle University, Business School – Economics, UK)

Abstract

Twin births are often used to instrument for fertility when investigating the impact of family size on labor market outcomes. In this paper we consider two econometric problems both related to the link between fertility treatments and multiple births. The first is the potential for omitted variable bias caused by the fact that fertility treatments are typically unobserved. We present estimates corrected for this bias and find it to be comparatively small. Second, we show that the effects of twin-birth induced variation in family size vary substantially with time passed since birth, which has consequences for the interpretation of estimates based on a single cross-section.

Suggested Citation

  • Nils Braakmann & John Wildman, 2014. "Reconsidering the impact of family size on labour supply: The twin-problems of the twin-birth instrument," Working Paper Series in Economics 316, University of Lüneburg, Institute of Economics.
    • Handle: RePEc:lue:wpaper:316
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    References listed on IDEAS

    as
    1. Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2005. "The More the Merrier? The Effect of Family Size and Birth Order on Children's Education," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 120(2), pages 669-700.
    2. Gary S. Becker & H. Gregg Lewis, 1974. "Interaction between Quantity and Quality of Children," NBER Chapters, in: Economics of the Family: Marriage, Children, and Human Capital, pages 81-90, National Bureau of Economic Research, Inc.
    3. Rosenzweig, Mark R & Wolpin, Kenneth I, 1980. "Testing the Quantity-Quality Fertility Model: The Use of Twins as a Natural Experiment," Econometrica, Econometric Society, vol. 48(1), pages 227-240, January.
    4. Joshua Angrist & Victor Lavy & Analia Schlosser, 2010. "Multiple Experiments for the Causal Link between the Quantity and Quality of Children," Journal of Labor Economics, University of Chicago Press, vol. 28(4), pages 773-824, October.
    5. Bronars, Stephen G & Grogger, Jeff, 1994. "The Economic Consequences of Unwed Motherhood: Using Twin Births as a Natural Experiment," American Economic Review, American Economic Association, vol. 84(5), pages 1141-1156, December.
    6. Kasey S. Buckles & Elizabeth L. Munnich, 2012. "Birth Spacing and Sibling Outcomes," Journal of Human Resources, University of Wisconsin Press, vol. 47(3), pages 613-642.
    7. Angrist, Joshua D & Evans, William N, 1998. "Children and Their Parents' Labor Supply: Evidence from Exogenous Variation in Family Size," American Economic Review, American Economic Association, vol. 88(3), pages 450-477, June.
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    Cited by:

    1. Mahdi Majbouri, 2019. "Twins, family size and female labour force participation in Iran," Applied Economics, Taylor & Francis Journals, vol. 51(4), pages 387-397, January.
    2. Majbouri, Mahdi, 2018. "Fertility and the Puzzle of Female Employment in the Middle East," IZA Discussion Papers 11322, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    Twin birth instrument; quantity-quality-tradeoff; labor supply; fertility;
    All these keywords.

    JEL classification:

    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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