Studies on labor force participation and paternity leave reforms

Abstract

This PhD thesis consists of an introductory chapter and three independent research articles. The second chapter notices that macroeconomic models with search and matching models with endogenous labor force participation generate a positively slopped Beveridge curve. The chapter shows that the inclusion of collateral constrains alone is not enough to generate a negative correlation between unemployment and vacancies. Adding financial shocks that change those collateral requirements enables the model to produce a countercyclical unemployment rate and a negatively slopped Beveridge curve.

The third and fourth chapters study the effects of four paternity leave reforms that happened in Finland from 2001 to 2010. Each reform introduced changes to different aspects of paternity leave taking. The reforms made paternity leave taking less bureaucratic, more flexible, longer, and with a higher replacement rate. The chapters use Finnish registry and social security data in a regression discontinuity setting. The results indicate that flexibility is important for families to be able to take paternity leave.

Since the goal of the four reforms were to reduce gender inequalities, the third chapter studies how those reforms affected the labor market and labor inequality. The regression discontinuity results showed that none of the reforms were capable to affect mothers’ or fathers’ employment, earnings, or the couples earnings gap. The fourth and last chapter tries to understand if the reforms had an unintended effect on family structure. That is, if the reforms affected union stability and fertility decision of couples. The results showed that the 2001 reduced the spacing between birth for the mothers under the age of 30. The 2007 reforms, on the other hand, increased the birth spacing as well for those under 30.

Publication Information

Carnicelli, L. (2024), Studies on labor force participation and paternity leave reforms, Dissertationes Universitatis Helsingiensis 10/2024.

• ISSN: 2954-2898 (Print), 2954-2952 (Online)
• ISBN: 978-951-51-9586-9 (Print), 978-951-51-9587-6 (Online)
• Press Release in Finnish