2013 Conference

Financial Services

This research aims to investigate the labor market behavior of mothers in response to the financial and time burden of caring for children with chronic conditions. An instrumental variable approach is used to address the potential endogeneity between the caregiving burden and mothers' employment. This research examines how mothers' employment behavior varies by the interaction between caregiving burden and children's age and by the interaction between caregiving burden and mothers' race/ethnicity. To answer these questions, this research analyzes data from the 2003-2007 National Health Interview Survey and 2004-2008 Medical Expenditure Panel Survey. The analytic sample includes 6,660 households. Consistent with the predictions of household production theory, a high financial burden is positively associated with mothers' employment probability, and a high time burden is negatively associated with mothers' employment probability. Both age effects and racial/ethnic differences are found. Mothers with older children who more frequently use healthcare are less likely to be employed than those with younger children. Mothers in minority groups are more responsive to both financial and time burden of caring for children, and they adjust their employment behavior accordingly.   Given the significance of continuous employment on the long-term economic security of mothers and families, the findings of this research have important implications to policy makers, financial educators and planners, and other service providers.