A Pooled Time-Series Analysis on the Relation Between Fertility and Female Employment

Various authors nd that in OECD countries the cross-country corre-lation between the total fertility rate and the female labour force participation rate turned from a negative value before the 1980s to a positive value there-after. Based on pooled time series analysis the literature seems to agree that this change is due to unmeasured country and time heterogeneity with respect to female employment. However, the role of female employment for time and country heterogeneity remains unclear. Using data of 22 OECD coun-tries from 1960-2000 we estimate pooled time series models of fertility and female labour force participation by applying random effects and xed effects panel models as well as Prais-Winsten regressions with panel-corrected stan-dard errors and autoregressive errors. Proceeding with Prais-Winsten regres-sions our empirical ndings reveal substantial differences across countries and time periods in the effects of female employment on fertility. Initial increases in female employment strongly lowers fertility, but continued increases have a progressively less negative effect. The country heterogeneity in the effect of female employment can also be conrmed for different regions as well as for varying welfare and gender regimes. European Demographic Research Papers are working papers that deal with allEuropean issues or with issues that are important to a large number of European Countries. All contributions have received only limited review. This material may not be reproduced without written permission from the au-thors.