Women Labor supply in China - Research Paper Example

Women Labor supply in China According to He, Xiaobo and Rong in America, it is reported that there is an increase in the participation of females in the labor force (4). Hence, economists have ventured in the study of the effects of fertility on the women’s labor participation. In China, the Government has passed a legislation dubbed one-child Policy that aims at controlling the number of children born yearly. However, despite the high population in China, women barely contribute to the workforce. From the time the Government started implementing the policy, the population as significantly reduced. Consequently, this has positively impacted in reducing the dependency ratio. Contrary to the achievements experienced, the policy has its economic drawbacks. There is a rise in the ageing populace in China as compared to the active young population. The rise in the number of the ageing population has consequently resulted in decreases in the labor force (3). Despite China being one of the most admired countries in terms of sustainable development, the passage of this policy raises questions about the efficacy of the one-child policy on the China’s sustainable development. Similarly, the greatest concern in the entire policy is whether fertility limits women from participating actively in the labor force. The question is important and requires an informed decision. However, there exist factors that restrict the understanding of the effect of fertility on women's participation in the labor force. One of the factors that contribute to complications of this question is that fertility issues are endogenous (6). Factors that contribute female participation in the labor force include preferences of women between childbearing and career; the two factors may overestimate the effect of fertility on female involvement in careers. According to this policy, every woman is supposed to have only one child for those residing in urban centers. Those in rural areas were allowed to have more than one child. However, it was legal for couples to avoid a second kid in case the first child is incapacitated. It was an illegality that was punishable for a couple to have a second child. Additionally, it was punishable by job loss, and also lack of access to public goods further to that local leaders have been supported by the central Government to implement the resources (Chen and Jianxian 15). This paper discusses the impact of an extra child to female participation in the workforce and the one-child policy effects in China. The difference between the rural and urban in the implementation of the policies is that the optimal scales differs in both setups. In rular areas Budget constraints are higher as compared to urban centers. The same case applies in China. Hypothesis and Research Model In class we learnt on the budget constraint and utility curve model. In the graph , X-axis have the leisure and Y-axis has the income. In the original situation before the policy was passed, the graph was linear. However, the establishment of the policy led to a shift of the optimal choice. Women participation in the workforce will provide a possibility of an increment of their wages. Ultimately, an increase in the wages will result to more leisure time and hence the shift of the curve. When income increases budget constraints will also be reduced, consequently from the graph the optimal choice will be higher than the original value. For example, if the budget of a family made up of twins was ten dollars in a day, if the woman is actively involved in the workforce the budget will increase since preferences will also increase. The optimal choice in the original situation without the Government policy it is what the consumer can afford. The consumers would like to move farther out, but they can not. This is because of the budget constraint. However, the Government policies brought a change in the graph since the consumer can increase their preferences. Income Leisure Previously, before the implementation of the One- Child Policy, there had been reported rampant cases of abortion and female infanticide. Consequently, the Government instituted rules that controlled the number of children born in different regions. In some areas, women were supposed to have two children in case the first one was a girl child. These rules led to the formulation of one child policy that is entitled to the entire population. All these factors have resulted in significant changes in the Chinese economy (17). Additionally, the samples used were made up of mothers whose age group ranged between thirty years and fifty years. They had given birth to children aged sixteen years and below and whose husbands resided in the same household. Thirdly, the sample used was made up of mothers who gave birth to one or two children (He and Xiaobo 18. Further to that, this paper focuses on the effects of the population ratio between the two years, their impact on the economy and female participation in the labor market. From the samples used in the research, it is evident that the female involvement in the labor is declining over time in Urban China.During the two years, the number of mothers who have given birth to twins has also decreased. Data Explanation and Support Similarly, to explain more on the interrelation between the female labor force participation and fertility, a linear model is applied as shown in the graph. In the model, the labor force participation is equal to one if the woman is in the workforce and zero if she is not in any workforce. In this linear model used named Empirical methodology also has variable children to identify the relationship between the number of children and labor participation. The model also considers the age of mothers who gave birth. Additionally, the model considers the probability of a twin birth and their effect on women participation. The results of this analysis indicate that having one more child increased the female labor force participation from the year 1999 to 2000. The results of the research are accurate when compared to the negative correlation between fertility and mothers work in books, and literature works written in both developing and developed countries. However, the adverse effects should be seriously considered since endogeneity of fertility in women work decisions will alter the estimates (43). It evident that the number of couples who had twins was significantly reduced in the two years. Consequently, it is apparent that the outcome of having a second child or twins in the female labor was negligible. This is based on the one-child policy; if it were relaxed there would be no identifiable changes. Additionally, the literature works written to correlate the fertility and mother’s labor force participation in urban China would not be real. In Argentina and Mexico, it is most likely that women will not participate in the labor force if they give birth. The trend is different in this developing countries; this is because of the varied traditions and fertility policies (Li, Hongbin, Junjian , and Junsen 27). Women who gave birth to twins are most likely to spend more time to heal and to take care of their newborn. The case is different for women who give birth to one child. In China, there is an enormous difference between the rural and urban areas. One Child policy has direct impacts on the female labor demand. China boasts of the largest female labor force participation among all the developing economies. This is mainly due to the policies formulated to control the population rate. However, there are historical aspects that can support the high number of women participation. Firstly, is the communist rule in China where women and men were equalized, and they were to be enjoying the same privileges and rights. Secondly, labor participation was not a personal decision; it was decided upon by other communist laws and their leaders in both society and families. Further to that, the control of fertility in China through policies has always elicited adverse effects (Li, Hongbin, Junjian, and Junsen 34). There are two reasons for this scenario; firstly, across the world, the number of children given birth by a couple is determined through a bargaining process. Consequently, only those with highest bargaining power can decide the number of children born. As a result, in case of a situation where women have less bargaining power, have to work more and give birth to more children. The effect of female labor force participation will not present a clear correlation between the impacts of number of children on labor force participation. For instance in rural China, people with higher earning capacities can take care of a higher number of children financially. Additionally, be able to work more; this will deviate from the one-child policy (Settles and Barbara 36).From the research done on samples obtained from the Chinese census, and also from literature works from different writers. It is evident that having an extra child does not contribute to barriers to women labor participation. For this reason, relaxation of One-Child Policy in urban China will not significantly reduce the Female labor force presentation in urban China. Conclusion Economists have engaged themselves in an extensive research on the importance of children in female labor supply decisions. This paper explains the effects of having an extra child or twins on the female’s labor participation in both urban and rural China. One –Child policy was formulated on the basis of the gender of the fist child and the Childs ethnicity. The two cases have different effects on the population. In the event of ethnicity of the child, One-Child Policy has an adverse effect on fertility for the affected population. However, having two or more children decreases the mother labor force participation over the years where the samples were obtained. The consequence of children on female labor force involvement has greatly increased over the years. This is due to the improved level of income, more freedom in labor allocation and the multiple labor choices available. Today, the Chinese Government has started a policy aimed at relaxation of the One-Child Policy. Works Cited Cameron, Lisa. "Little emperors: behavioral impacts of China's one-child policy." Science 339.6122 (2013): 953-957. Print Chen, Jianxian, "Factors that influence female labor force supply in China." Economic Modelling 37 (2014): 485-491. Retrieved from http://www.sciencedirect.com/science/article/pii/S0264999313005464 on February 2, 2015 He, Xiaobo, and Rong Zhu. "Fertility and Female Labor Force Participation: Causal Evidence from Urban China." (2013). Retrieved from < http://www.flinders.edu.au/sabs/nils-files/publications/working-papers/WP%20191.pdf on 2nd February 2015 Li, Hongbin, Junjian Yi, and Junsen Zhang. "Estimating the effect of the one-child policy on the sex ratio imbalance in China: identification based on the difference-in-differences." Demography 48.4 (2011): 1535-1557. Print Mu, Ren, and Dominique van de Walle. "Left behind to farm? Women's labor re-allocation in rural China." Labour Economics 18 (2011): S83-S97. Print Settles, Barbara H,. "The one-child policy and its impact on Chinese families." International Handbook of Chinese Families. Springer New York, 2013. 627-646. Wang, Hui. "Fertility and Female Labor Force Participation: Evidence from One Child Policy in China." 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota. No. 169288. Agricultural and Applied Economics Association, 2014. Read More