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Children and Their Parents' Labor Supply: Evidence from Exogenous Variation in Family Size

Joshua D. Angrist and William N. Evans
The American Economic Review
Vol. 88, No. 3 (Jun., 1998), pp. 450-477
Stable URL: http://www.jstor.org/stable/116844
Page Count: 28
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Children and Their Parents' Labor Supply: Evidence from Exogenous Variation in Family Size
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Abstract

Research on the labor-supply consequences of childbearing is complicated by the endogeneity of fertility. This study uses parental preferences for a mixed sibling-sex composition to construct instrumental variables (IV) estimates of the effect of childbearing on labor supply. IV estimates for women are significant but smaller than ordinary least-squares estimates. The IV are also smaller for more educated women and show no impact of family size on husbands' labor supply. A comparison of estimates using sibling-sex composition and twins instruments implies that the impact of a third child disappears when the child reaches age 13.

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