Essays in Labor Economics

Abstract

This dissertation consists of two chapters on labor economics. Despite differentia between topics, both share a similar property: causal effects analysis in the presence of unobserved variables. The first chapter examines the effects of China's two-child policy on childbearing, marriage, and female labor force participation. Using data from the China Labor-Force Dynamic Survey (CLDS) for 2012, 2014 and 2016, it generates three broad results. First, the universal two-child policy had a significant positive impact on having a second child during a portion of its phase-in. Second, the two-child policy did not influence the likelihood of marriage for young people. Third, female labor participation increased after the two-child policy, regardless of the number of children. Moreover, one child mothers' work hours and participation did not fall relative to other mothers as might be expected if employers newly saw one child mothers as less likely to persist in employment because of the policy change. The second chapter studies the effects of lender-borrower interactions on the microfinance market. Based on data from the Wisconsin Women’s Business Initiative Corporation (WWBIC), we analyze the potential influence of training and consulting assistance on the borrowers’ timely repayment. Using pooled data of monthly repayment by clients, initial results suggest that increased consulting services are associated with a decreased rate of missed payments. After a series of robustness tests, including client fixed effects, this relationship remains but only for those with a higher credit rating (620 or above). Attempts to aggregate data by client provide mixed evidence in both traditional and IV estimates. The results show that more risky clients respond more to the consulting service while consulting services can significantly improve the borrower’s repayment regardless of the client’s riskiness.