The impact of childbirth on Spanish women’s decisions to leave the labor market

Abstract

The present paper analyzes the effect of childbirth on Spanish women’s decisions to withdraw from paid work, defined here as the transition from employment to out of the labor force due to the requirements of household production. Decisions regarding fertility and labor market participation are interrelated and depend on individual and household characteristics, as well as external variables such as the availability of childcare services. We postulate that a female’s decision to leave the labor market is taken in a household context, and thus is the outcome which maximizes household welfare after taking into account the employment and earnings characteristics of all household members. We pay special attention to the effect of the male partner’s characteristics upon the female’s decision to withdraw from the labor market. Our empirical results show that in order to better define social and labor market policies on work and family reconciliation, increased attention should be paid to the job characteristics of males given their effect on the optimal assignment of tasks within the household following childbirth.