2007-03 EC: Why Have the Labour Force Participation Rates of Older Men Increased Since the Mid 1990s (working paper)
published: 2007 | Research publication | Working Paper - Economics
ABSTRACT: This paper seeks to explain the substantial increases in older menís labour force participation rates that have been observed since the mid-1990s. Using data from the U.S. March Current Population Survey, the Canadian Labour Force Survey, and the U.K. Labour Force Survey, I investigate the hypothesis that husbands treat the leisure time of their wives as complementary to their own leisure at older ages. I exploit the cohort effects driving recent increases in older womenís participation rates to identify the effect of a wifeís participation decision on her husbandís participation decision. Given this complementarity in leisure time, a large portion of the increase in older menís participation rates may be explained as a response to the recent increases in older womenís participation in the labour force. The methodology of Dinardo, Fortin, and Lemieux (1996) is used to decompose the changes in older married menís participation rates, demonstrating that increases in wivesí participation in the labour force can explain roughly one quarter of the recent increase in participation in the U.S., almost one half of the recent increase in participation in Canada, and roughly one third of the recent increase in the U.K. Older menís educational attainment is also an important factor explaining recent increases in participation, yet cannot be expected to drive further increases in participation rates. In contrast, expected increases in older wivesí participation over the next decade are expected to drive further increases in older menís participation rates.
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revised Apr 17/07