Finance Discipline Group
UTS Business School
University of Technology, Sydney

Working Paper Series

A Decomposition of the Labour Market Participation of Married Women in Three Countries: Australia, Canada and the United States of America
Author(s): Vera Brusentsev
Date of publication: July 2000
Working paper number: 106
This study examines cross-national variation in the labour force participation of married women in Australia, Canada and the United States of America (USA), three countries of similar socio-economic development, in order to assess the observed differences in their labour market behaviour. While cross-national variation in labour force participation may be explained by a number of factors, a decomposition of the variation in cross-national labour market participation rates is explored in this study. Initially, a basic model of female labour force participation is presented using data from the Luxembourg Income Study (LIS). The results of the basic model show that the probability of married women participation in the labour market in all three countries is inversely associated with the number of children under the age of 18 years, while higher eductaion and age at younger ages are associated with a higher probability. Two applications of the estimates are presented in the study: a simulation and a decomposition of the variation in cross-national labour force participation. The simulation exercise indicates that variation in cross-national labour force participation rates for married women can be explained by both country-specific characteristics and the measured differences in the responses to those characteristics. The decomposition of the differential in labour force participation into the effect of country-specific characteristics and the effect of responses shows that if the responses of married women in Canada are imposed on the characteristics of Australian women, then participation is higher. On the other hand, if the characteristics for either Canada or the USA are applied to the behavioural responses in Australia, then the labour market partiicipation of married women is also higher. This confirms that differences in country-specific characteristics and responses both contribute to explaining cross-national variation.
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