Assessing the 'Engines of Liberation': Home Appliances and Female Labour Force Participation

18 Pages Posted: 28 Jul 2006

See all articles by Tiago Cavalcanti

Tiago Cavalcanti

New University of Lisbon

José Tavares

Centre for Economic Policy Research (CEPR); Nova School of Business and Economics

Date Written: May 2006

Abstract

The secular rise in female labour force participation, highlighted in the recent macroeconomics literature on growth and structural change, has been associated with the declining price and wider availability of home appliances. This paper uses a new and unique country dataset on the price of home appliances to test its impact on female labour supply. We assess the role of the price of appliances in raising participation by comparing it to other structural determinants such as average male income. A decrease in the relative price of appliances - the ratio of the price of appliances to the consumer price index - leads to a substantial and statistically significant increase in female labour force participation. In the United Kingdom, for instance, the decline in the relative price of home appliances accounts alone for about 10 to 15 percent of the increase in female labour force participation from 1975 to 1999. This result is robust to the inclusion of additional controls, such as country dummies, time trend, government spending, capital to output ratio, and the growth rate of real GDP. To assess causality, we test for exogeneity and use the manufactured price index as an instrumental variable, confirming that lower appliance prices lead to increased female participation.

Keywords: Female labour force participation, home appliances, structural changes, business cycles

JEL Classification: J22, O11

Suggested Citation

Cavalcanti, Tiago and Tavares, José, Assessing the 'Engines of Liberation': Home Appliances and Female Labour Force Participation (May 2006). CEPR Discussion Paper No. 5665, Available at SSRN: https://ssrn.com/abstract=921093

Tiago Cavalcanti (Contact Author)

New University of Lisbon ( email )

Lisbon, 1099-085
Portugal

José Tavares

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

Nova School of Business and Economics ( email )

Campus de Carcavelos
Rua da Holanda, 1
Carcavelos, 2775-405
Portugal

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