The Impact Of Grandparents’ Childcare On Married Females’ Labor Supply In China

Since the reform and opening up,China has achieved rapid economic development through the demographic dividend.However,since 21 th century,the population structure in China is deteriorating,the elderly population is rising continuously,the proportion of working-age population is declining,females’ labor force participation rate is dropping rapidly.These changes have weakened China’s demographic dividend,potential economic growth,increased the social pension burden and it is an important risk and challenge for population and economic development.To improve the population structure,the universal two-child policy was carried out since January 2016.However,this policy has further led to the decrease of females’ labor supply.As the behaviour of fertility and childcare need females to spend a lot of time,which may occupy females’ working hours and have crowding-out effect on employment.Besides,some females may be unwilling to fertilize considering that childcare have negative impacts on their employment and career development.In that case,it is difficult for the policy to realize the purpose of increasing fertility.To reduce the crowding-out effect and reduce concerns about childcare burden caused by the universal two-child policy so that the policy can improve the population structure without causing too much declining in females’ labor supply.we need to shift married females’ childcare responsibilities to others.With the increase of childcare cost,working mothers are gradually seek childcare help from families,such as grandparents.In the background of aging problem,grandparents’ childcare highlight the contribution of the elderly and it meets the purpose of active aging.What is more,it can alleviate females’ "work-family" conflict by share the childcare burden,so that mothers can be released from childcare and have more time to be spent on their work.By this way,it can encourages females to participate in labor to make up the labor shortage and promote the universal two-child policy to achieve desired results.This paper takes married females who are 20-54 years old and with children age 0-12 years old as the target population.and explores the impact of grandparents’ childcare on the females’ labor supply,including the impact females’ labor participation and working hours per week.I review and summarize the relevant literature and use the family utility maximization theory to provide some support for empirical model.I use the data of CFPS in2014,2016 and 2018 according to my research purpose and keeping the continuity of data and variables.Considering that the data in 2014,2016 is different from the data in 2018,and after2016,the the universal two-child policy was implemented,I use the pooled data in 2014-2016 and yearly data in 2018.Considering that different grandparents’ childcare ways may have different effects on female labor supply,I separate grandparents’ childcare in different situations: grandparents’ childcare（no matter day-time or night time,as long as grandparents participate in childcare,it can be called grandparents’ childcare）,day-time grandparents’ childcare（grandparents take care of children only in the day-time）,night-time grandparents’ childcare（grandparents take care of children only at night）,all-day grandparents’ childcare（grandparents take care of children both day and night）,I conduct a descriptive analysis and regression analysis of these grandparents’ childcare ways,and compare the their impact on females’ labor force participation and working hours per week.In basic regression,probit model is used in females’ labor force participation,and the Heckman model is used in females’ working hours considering the sample selection bias.The results show that grandparents’ childcare increase the probability of females’ labor force participation by 6.1% in 2014-2016 and by 15.8% in 2018,and it increase females’ weekly working hours by 3.6 hours in 2014-2016 and by 4.8 hours in 2018.Therefore,the impact is much large in 2018.In addition,I find that night-time grandparents’ childcare can not promote females’ labor force participation.But day-time grandparents’ childcare and all-day grandparents’ childcare can increase the probability of females’ labor force participation and weekly working hours,and the effect of all-day grandparents’ childcare is larger than day-time grandparents’ childcare.Which means the greater the intensity of grandparents’ childcare,the greater the impact on females’ labor supply.Considering that grandparents’ childcare may be endogenous,I used ivprobit model in females’ labor participation and ivheckman model in females’ working hours.After adding IVs “whether grandfather is alive” and “whether grandfather is alive”,the impact of grandparents’ childcare on females’ labor force participation rate is become larger,while in the regression of weekly working hours,the coefficient of grandparents’ childcare is negative significant,which is not consistent with theory and others.After testing the IVs,I find these two IVs are good IVs in the model of females’ labor force participation,but they are not good IVs in the model of females’ working hours.In heterogeneity analysis,I find that the effect of grandparents’ childcare on females’ labor supply in the group of non-agriculture is much larger than that of in the group of agriculture.In children’s age heterogeneity analysis,grandparents’ childcare have a more important role in promoting females’ labor force participation in the group of children age under 3 but have more important role in increasing females’ working hours in the group of children over 3.Based on these results,I have some policy recommendations.From the perspective of grandparents,set policies to encourage grandparents’ childcare,such as provide subsidies,childcare knowledge and skills training to the elderly,and encourage the elderly to live with children or live near children.From the perspective of married females,provide employment security for females,such as,promote flexible work system to females,set male parenting leave to reduce employment discrimination caused by gender,strengthen maternity protection for females.