The Occupation, Marriage, and Fertility Choices of Women: A Life-Cycle Model

An extensive literature in labor economics recognizes that the life-cycle labor force participation of a woman is highly associated with her family choices. There is, however, virtually no study going further to incorporate female occupational choices. This paper attempts to fill this gap in labor supply literature by examining the interrelatedness of occupation, marital status and fertility choices of women over the life cycle. A discrete choice dynamic utility maximization model is constructed to investigate how relevant determinants influence a woman’s career and family path and how these decisions interplay with each other. Using longitudinal data on women from the 1979 youth cohort of the National Longitudinal Survey of Youth, I estimate my model through the maximum likelihood estimation method in a dynamic programming fashion which takes into account the uncertainties from random arrivals of job opportunities, unexpected failure of birth control and temporary shocks to family earnings. The estimation results of structural parameters indicate that women’s lifecycle patterns of occupation, marriage and contraceptive behaviors vary significantly with their observable characteristics such as age, education, ability, race, and the presence of young children.