The interaction between labour force participation of older men and their wife: lessons from France

Since the mid-1990s, the labor force participation of older men and women increased substantially in France. In this paper, we investigate the causal impact of having a participating wife on the labor market behavior of the elderly husband. Working with data from the French Labour Force Survey and using the cohort-specific participation rate of women at age 40 as an instrument for their current participation, we find that the magnitude of the causal relationship is strong. The likelihood of husbands’ participation increases of about 28 points when their wives are currently active on the labor market. Such findings support the view that some complementarities in leisure exist so that French married men attribute a higher value to leisure when it is shared with their wife. It also suggests that policy makers should take into account both direct and indirect effects when they implement a change in the economic environment of elderly