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Labor Market Decisions of Mothers with Chronically Ill Children
Short Abstract
Chronically ill children impose increased caregiving and medical costs on their families. Household production theory suggests that families will respond by adjusting their efforts in the labor market and the household accordingly. In this study, we investigate the labor market behavior of mothers facing the financial and time burdens of caring for children with chronic conditions. Due to endogeneity between financial and time burdens, we employ an instrumental variables approach. As expected, we find positive effects of financial burden and negative effects of time burden on mothers’ labor market participation. We also investigate whether there are effects of the child’s age, race or ethnicity on mothers’ employment behavior. Some evidence exists for age effects on mothers’ employment. Mothers in the minority groups are more responsive to care burdens and adjust their employment behavior accordingly. Non-Hispanic black mothers are the most responsive group.