Grandmothers’ Labor Supply

Abstract

The labor supply effects of becoming a grandmother are not well established in the empirical literature. We estimate the effect of becoming a grandmother on the labor supply decision of older workers. Under the assumption that grandmothers cannot predict the exact date of conception of their grandchild, we identify the effect of the first grandchild on employment (extensive margin). Our Timing-of-Events approach shows that having a first grandchild increases the probability of leaving prematurely the labor market. This effect is stronger when informal childcare is more valuable to the mother. To estimate the effect of an additional grandchild (intensive margin), we assume that the incidence of a twin birth among the third generation is not correlated with unobserved determinants of the grandmother's labor supply (first generation). Our respective instrumental variable estimations show a significant effect of further grandchildren. Our results highlight the important influence of the extended family on the decisions of older workers and point to mediating effects of different institutional settings.

Do Family Policies Reduce Gender Inequality? Evidence from 60 Years of Policy Experimentation

“…In a recent study for Austria,Frimmel, Halla, Schmidpeter and Winter-Ebmer (2020) find that grandmothers' labor supply reacts to the presence of grandchildren. A timing-of-events approach shows that a first grandchild increases the probability of leaving the labor market by 9 percent, an effect which is partiularly strong when grandmothers live close to the grandchild.…”

Grandmothers and Non-grandmothers in the Polish Labor Market: The Role of Family Issues

“…For example, while evidence from China suggests that the introduction and strengthening of formal child care programs may have important effects on enabling labor force participation among women aged 40 to 60 years (Lin & Wang, 2017), Hochman and Lewin-Epstein (2013) find that family policies do not mitigate preferences for retirement among grandparents in Europe. Frimmel et al (2017), in their Austria-based study, extend that argument by demonstrating that grandmothers tend to reduce their workload to a greater extend in communities with formal child care institutions rather those without such institutions. This, as they explain, may be related to those institutions’ working hours that make grandmaternal care an important complement to formal child care.…”

“…No similar relationship was found for grandfathers. Focusing specifically on grandmothers, Frimmel, Halla, Schmidpeter, and Winter-Ebmer (2017) demonstrate that the likelihood of withdrawing from the labor market increases by 8% for first-time grandmothers as compared with nongrandmothers in Austria. Although the effect of becoming a grandmother on the labor market participation reduces with the grandchild’s age, it remains significant even during school years (Frimmel et al, 2017).…”

Does Grandparenting Pay off for the Next Generations? Intergenerational Effects of Grandparental Care

“…A number of studies have shown negative effects of grandparenthood on grandparental labor supply (e.g. Backhaus and Barslund, 2021;Frimmel et al, 2020;Rupert and Zanella, 2018). The effects can be attributed to caring grandmothers who are less attached to the labor market -at least for the cohorts studied so far.…”