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Desta CG

Moffitt, 1984; Sheran, 2007). In a lifecycle framework, it is argued that since young children are more time intensive
than adult children (Hotz and Miller, 1988; Fehr and Ujhelyiova, 2012; Moffitt, 1984), mothers may be less likely to
work with an increasing number of young children and more likely to work when children are adults.
Lifecycle frameworks to fertility and labor supply decisions, which are seen to be dynamic and jointly determined,
highlight the potential value of focusing on parents’ preferred timing of childrearing and labor supply over the lifecycle
(Francesconi, 2002; Hotz and Miller, 1988; McNicoll, 1984; Moffitt, 1984; Rosenzweig and Wolpin, 1980b; Sheran,
2007). In this framework, parents’ fertility and labor market participation decisions reflect different timing preference.
For example, couples may (1) prefer to have children early in their lifecycle and delay participation in the labor market,
(2) participate in the labor market first delay childbearing, or (3) prefer to participate in the labor market both early and
latter in their lifecycle, allocating their working ages for childrearing (Cho, 2006). The framework is, therefore,
considered to be a useful tool in analyzing fertility and maternal labor supply behaviors over the lifecycle (Adda,
Dustmann and Stevens, 2011; Cho, 2006; Erosa, Fuster and Restuccia, 2016; Fehr and Ujhelyiova, 2012; Francesconi,
2002; Hotz and Miller, 1988; McNicoll, 1984; Moffitt, 1984; Sheran, 2007).
However, while ample cross-national macro-level empirical evidence for the age dependency hypothesis (population
level) is available, the lifecycle hypothesis (household level) is empirically little explored (see e.g., Browning and
Crossley, 2001; Chernichovsky, 1978; Davies, 1988; Kelley and Schmidt, 2001). In addition, despite the ample research
undertaken to estimate the relationship between fertility and maternal labor participation, empirical research is
complicated by the endogeneity of fertility in female labor supply decisions. Several studies have used instrumental
variable estimation as a solution to this problem (e.g., Aassve and Arpino, 2007; Angrist and Evans, 1998; Bloom,
Canning, Fink, et al., 2009; Chun and Oh, 2002; Cruces and Galiani, 2007; Kim and Aassve, 2006; Kim, Engelhardt,
Prskawetz, et al., 2009; Orbeta, 2005). The vast majority of empirical studies find results consistent with this theoretical
prediction relating fertility and maternal labor participation, but there are some studies in the case of developing
countries which fail to replicate the expected relationship (e.g., Aghajanian, 1979 for Iran; Angrist and Evans, 1998 for
references on a similar evidence for other countries; Cho, 2006 for Korea; Solomon and Kimmel, 2009 for Ethiopia).
When it comes to the context of Ethiopia, the allegedly adverse consequence of rapid population growth on economic
development has been acknowledged by the national population policy and the different national development
consecutive plans (IMF, 2006; Ministry of Finance and Economic Development, 2002; 2006; 2010; Transitional
Government of Ethiopia, 1993; UNDP, 2001; UN Population Division, 2005). The development plans identify, among
other things, maternal labor market participation as critical for achieving the planned development. One major strategy
suggested by the plan documents to achieve this is ensuring balanced population and economic growth, for example,
through reducing fertility.
In Ethiopia, fertility has been one of the highest among the developing countries, but substantial decline has begun in
recent years (United Nations, 2017: 33). Modern contraceptive use has recently risen, for example, from 11 percent in
2000 (Central Statistical Agency of Ethiopia and ORC Macro, 2000) and 15 percent in 2005 (Central Statistical Agency
of Ethiopia and ORC Macro, 2005) to 29 percent in 2010 (Central Statistical Agency of Ethiopia and ORC Macro,
2011). Correspondingly, total fertility rate is declining substantially though still high, for example, from 5.9 in 2000
(Central Statistical Agency of Ethiopia and ORC Macro, 2000) and 5.4 in 2005 (Central Statistical Agency of Ethiopia
and ORC Macro, 2005) to 4.8 in 2010 (Central Statistical Agency of Ethiopia and ORC Macro, 2011). The average
annual rate of population growth has also dropped from 2.9 percent during the 1984 – 1994 intercensal period to 2.6
percent during the 1994 – 2007 intercensal period (Hailemariam, Alayu and Teller, 2011; UNFPA, 2010).
However, with fertility declining much more slowly than mortality, the country is yet in the early stage of the
demographic transition (Ringheim, Teller and Sines, 2009). The percentage of women working in productive activities is
low (Transitional Government of Ethiopia, 1993). For example, the Ethiopian DHS 2005 (Central Statistical Agency of
Ethiopia and ORC Macro, 2005) shows female participation rate to be 32 percent by the time of the survey. Apart from
its implication for achievability of the planned growth and transformation, this low maternal labor supply amid falling
fertility rate is interesting given the forgoing theoretical discussion regarding maternal labor market participation effect
of fertility.
The question of interest to the present study, therefore, is whether and the extent to which fertility influences labor
market participation of Ethiopian households. Available research regarding maternal labor market participation effect of
fertility is spatially polarized, concentrating in Latin American and South and Southeast Asian countries (Aassve and
Arpino, 2007).
For Ethiopia, evidence is very limited. The first published work known to the present author is by Solomon and
Kimmel (2009), which sought to examine the relationship between fertility and the labor supply of the mother, and the
second is by Desta (2013), which, however, examined the effect of children on maternal hours of work for working
mothers, instead. As such, the available research is very inadequate to inform policy and that there is no adequate context
30 International Journal of Population Studies | 2017, Volume 3, Issue 2