Female labor market transitions and the timing of births: a simultaneous analysis of the effects of schooling

This paper develops a simultaneous analysis of the timing of births and lab or market transitions of women in the Netherlands. The results show that an increase in the years of schooling of a woman causes her to schedule birth s later in life but it does not significantly affect her completed fertilit y. Moreover, the effects of an increase in schooling on the timing of birth s mainly have an impact through changes in female employment status: a more highly educated woman is more likely to move into employment and, conseque ntly, to delay births. We show that ignoring the endogeneity of fertility r esults in an underestimation of the effects of schooling on lifecycle femal e employment. Unobserved heterogeneity, interpreted as preferences over wor k and children, turns out to be of major empirical importance. Women with a higher preference of work over children have significantly higher employme nt rates at all ages, delay births and have a significant lower level of co mpleted fertility. (C) 2001 Elsevier Science B,V. All rights reserved.