Measuring the Effects of Childbearing on Labor Market Outcomes

Decisions about childbearing and market work are significantly interrelated. Although there are many estimates of the effects of fertility on labor supply, few of them have adequately addressed the problems of simultaneity inherent in these choices. In our research we use exogenous variations in fertility due to twin births to measure the impact of an unplanned child on labor supply and earnings. We contrast these results to those for closely-spaced births (one year or less). We consider effects for married and unmarried mothers separately, and for married fathers. We discuss the implications of these measurements for estimating the magnitude of the rise in female labor supply and earnings as birthrates decline.