Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/73566 
Year of Publication: 
2008
Series/Report no.: 
Working Paper No. 0802
Publisher: 
Johannes Kepler University of Linz, Department of Economics, Linz
Abstract: 
In this paper we investigate how fertility decisions respond to unex- pected career interruptions which occur as a consequence of job displace- ment. Using an event study approach we compare the birth rates of dis- placed women with those of women una®ected by job loss after establish- ing the pre-displacement comparability of these groups. Our results reveal that job displacement reduces average fertility by 5 to 10% in both the short and medium term (3 and 6 years) and that these e®ects are largely explained by the response of white collar women. Using an instrumen- tal variable approach we provide evidence that the reduction in fertility is not due to the income loss generated by unemployment but arises be- cause displaced workers undergo a career interruption. These results are interpreted in the light of a model in which the rate of human capital accumulation slows down after the birth of a child and all specific human capital is destroyed upon job loss.
Subjects: 
fertility
unemployment
plant closings
human capital
JEL: 
J13
J64
J65
J24
Document Type: 
Working Paper

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