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Atlanta Fed Working Papers


To Work or Not to Work: The Economics of a Mother's Dilemma

Julie L. Hotchkiss, M. Melinda Pitts, and Mary Beth Walker
Working Paper 2011-2
March 2011

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Utilizing linked vital statistics, administrative employer, and state welfare records, the analysis in this paper investigates the determinants of a woman's intermittent labor force decision at the time of a major life event: the birth of a child. The results indicate that both direct and opportunity labor market costs of exiting the workforce figure significantly into that decision. Further, the analysis reveals the importance of including information about the mother's prebirth job when making inferences about the role various demographics play in the intermittent labor force decision.

JEL classification: J22, J13, J17, D01, D91

Key words: labor supply behavior, intermittent, labor market exit, labor leisure choice model


The authors gratefully acknowledge Nicole Baerg, Keyung Wang, and Chunying Xie for excellent research assistance. They also thank seminar participants at the University of Colorado at Denver for helpful comments. The views expressed here are the authors' and not necessarily those of the Federal Reserve Bank of Atlanta or the Federal Reserve System. Any remaining errors are the authors' responsibility.

Please address questions regarding content to Julie L. Hotchkiss, Research Department, Federal Reserve Bank of Atlanta, 1000 Peachtree Street, N.E., Atlanta, GA 30309-4470, 404-498-8198, 404-498-8956 (fax), julie.l.hotchkiss@atl.frb.org; M. Melinda Pitts (contact author), Research Department, Federal Reserve Bank of Atlanta, 1000 Peachtree Street, N.E., Atlanta, GA 30309-4470, 404-498-7009, 404-498-8956 (fax), melinda.pitts@atl.frb.org; or Mary Beth Walker, Andrew Young School of Policy Studies, Georgia State University, P.O. Box 3992, Atlanta, Georgia 30302-3992, 404 413-0254, mbwalker@gsu.edu.

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