What Can Boost Female Labor Force Participation in Asia?

40 Pages Posted: 14 Apr 2015

See all articles by Yuko Kinoshita

Yuko Kinoshita

International Monetary Fund (IMF); University of Michigan, William Davidson Institute; Centre for Economic Policy Research (CEPR)

Fang Guo

Yokohama National University

Date Written: March 2015

Abstract

Both Japan and Korea are trying to boost female labor force participation (FLFP) as they face the challenges of a rapidly aging population. Though FLFP has generally been on a rising trend, the female labor force in both countries is skewed towards non-regular employment despite women’s high education levels. This paper empirically examines what helps Japan and Korea to increase FLFP by type (i.e., regular vs. non-regular employment), using the SVAR model. In so doing, we compare these two Asian countries with two Nordic countries Norway and Finland. The main findings are: (i) child cash allowances tend to reduce the proportion of regular female employment in Japan and Korea, (ii) the persistent gender wage gap encourages more non-regular employment, (iii) a greater proportion of regular female employment is associated with higher fertility, and (iv) there is a need for more public spending on childcare for age 6-11 in Japan and Korea to help women continue to work.

Keywords: Labor force participation, Japan, Korea, Republic of, Norway, Sweden, Asia, Women, Employment, Cross country analysis, Structural vector autoregression, Econometric models, female labor force participation, fertility, labor market duality, regular employment

JEL Classification: J08, J13, J16, J21, J71

Suggested Citation

Kinoshita, Yuko and Guo, Fang, What Can Boost Female Labor Force Participation in Asia? (March 2015). IMF Working Paper No. 15/56, Available at SSRN: https://ssrn.com/abstract=2594139

Yuko Kinoshita (Contact Author)

International Monetary Fund (IMF) ( email )

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University of Michigan, William Davidson Institute

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Ann Arbor, MI 48109-1234
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Fang Guo

Yokohama National University ( email )

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