Child Gender, Parental Investment, and Labor Market Outcomes

Abstract

This paper provides new evidence of the effects of child gender on parental labor supply and earnings in two-parent families with one child. Using data from the China Health and Nutrition Survey, I document a son premium on the intensive margin of both paternal and maternal labor supply. Parents with a newborn to six-year-old son have higher labor supply than parents with a daughter of the same age group. A further examination indicates that co-residence with grandparents induces the son premium. Grandparents are more likely to live in the same household as a grandson than granddaughter, which allows parents with a preschool age son to work more. The intensification of market work associated with having a son leads to differential developmental investments in boys and girls, which causes gender differences in cognitive ability, education and other measures of a child’s well-being. It may also affect the economic outcomes over the lifecycle of parents through labor market attachment.