Three essays in labor economics: fertility expectations and career choice, specialization and the marriage premium, and estimating risk aversion using labor supply data

Abstract

Women, on average, are found in systematically different careers than men. The reason for this phenomenon is not fully understood, in part because expectations play a vital role in the process of career choice. Different religious groups have different beliefs on the importance of child bearing, so fertility expectations should differ by religious group. I include a woman's religious denomination in regressions on mea- sures of occupational flexibility. Jehovah's Witnesses choose the most flexible careers followed by Pentecostal, Catholic, Baptist, and Mainline Protestant women. Jewish women generally choose the least flexible careers. This is consistent with the human capital notion that women are choosing different careers than men rather than being forced into different job paths. If women are choosing jobs that allow them to take responsibility for home pro- duction, how does this affect their husbands? Male wage regressions that include marital status dummy variables find a marriage wage premium of 10 to 40%. This premium may occur because wives are taking responsibility for home production and husbands are free to focus their attention on productivity at work. It may also be that factors unobserved to the researcher may make a man more productive and more likely to marry. I use religious denomination as a proxy for specialization within the home. Men in more traditional religious denominations enjoy a higher marriage wage premium, which is evidence that household specialization of labor is an important cause of the wage premium. The choice of a career, whether to marry, and most other important life decisions are dependent on one's risk tolerance. The role of risk preferences in such choices is not fully understood, largely because relative risk aversion (y) is hard to empirically quantify. Chetty (2006) derives a formula for ° based on the link between utility and labor supply decisions. I estimate y at the micro level using the 1996 Panel Study of Income Dynamics. I compare y to an estimate based on hypothetical gambles and find the measures substantially different. This supports Chetty's claim that ex- pected utility theory cannot suffciently explain choices under uncertainty in different domains.