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The effect of the universal two-child policy on female labour market outcomes in China

Published online by Cambridge University Press:  01 January 2023

Qian Huang  and
Xiaofei Jin Open the ORCID record for Xiaofei Jin [Opens in a new window]
Qian Huang
Affiliation:
Nankai University, People’s Republic of China
Xiaofei Jin*
Affiliation:
Nankai University, People’s Republic of China
*
Xiaofei Jin, School of Economics, Nankai University, No 94 Weijin Road, Nankai District, Tianjin, 300071, China. Email: jin_xiaofei@163.com
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Abstract

To alleviate the imbalance in demographics, the Chinese government initiated the universal two-child policy nationwide in 2016, which has comprehensively impacted society, especially females. Our study investigates whether this policy has negatively affected workforce employment and income among women in urban areas. Based on the DID (difference-in-differences) method and the Heckman Two-Step Estimation, reliable empirical evidence shows that the universal two-child policy has significantly reduced women’s employment by 4.06% and decreased their labour income by 10.43%. Surprisingly, this policy has decreased the employment among women under 25 years old by 23.99% and has reduced the income of higher educated females by 29.59%. Furthermore, we find that the influence of the universal two-child policy on female employment has gradually increased from 2016 to 2018, and its impact on income has presented an evident time lag.

Keywords

J13J21J31The universal two-child policyfertilityfemale employment and incomedifference-in-differences
Type
Gender and work
Information
The Economic and Labour Relations Review , Volume 33 , Issue 3 , September 2022 , pp. 526 - 546
Copyright
Copyright © The Author(s) 2022

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