Do Women have Different Labor Supply Behaviors? Evidence based on Educational Groups in Uruguay

Abstract

This study uses Uruguay’s historical fluctuation in real wages to set up a natural experiment to measure the relation between women’s labor supply and wages. Using data from the Continuous Household Surveys of the Uruguayan National Statistics Institute, for 1986–2010, it aims to identify and explain heterogeneity in the labor supply behavior of women with different educational backgrounds. It finds that all women groups seek to optimize their remunerated work allocation throughout their life cycle, although women’s labor behaviors vary depending on educational levels. The rising trend of women’s labor force participation is expected to continue; its implications at the intensive margin are ambiguous and depend on how women conciliate paid work with household responsibilities – especially women with less education. These results could inform present debates about designing public policies to facilitate women’s entry into the labor market and cater to their different wage profiles and household care demands.