Stanford University
Walter H. Shorenstein Asia-Pacific Research Center
Asia Health Policy Program
Working paper series
on health and demographic change in the Asia-Pacific
The Effect of Family-Friendly Policies on Fertility andMaternal Labor Supply
Nobuko Nagase, Ochanomizu University

Asia Health Policy Program working paper #42
May 4, 2017
http://asiahealthpolicy.stanford.edu
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Electronic copy available at: https://ssrn.com/abstract=2965185

The Effect of Family-Friendly Policies on Fertility and Maternal
Labor Supply
Evidence from Japan Using Natural Experiments
Nobuko Nagase1
nagase.nobuko@ocha.ac.jp
ABSTRACTLow fertility is a major policy focus in Japan. Many policies, such as an increase in replacement
allowances during parental leave, were rolled out during the 1990s and early 2000s with little
evidence that they had any effect on fertility or labor supply. This study assesses the impact ofpolicies designed to promote a family-friendly work culture on childbirth and labor supply fromthe mid-2000s on. The causal effects are identified by investigating two reform policies targetedat two different sizes of firms. The paper contributes to the literature on laws that impact
organizational culture in a society where both gender and organizational norms are strong. The
short-hour option in Japan significantly increased childbirth among working women who had
been childless. The intent to give birth also increased among childless women at the treatedfirms, and there was an increased likelihood of women taking up permanent employment at
reduced hours following their first childbirth. The policy effect was not significant for second or
third births.
Key words: short-hour option mandate, childbirth hazard, labor supply following childbirth

I.

Introduction

1

Nobuko Nagase, Ph.D., is professor of Labor Economics and Social Policy at Ochanomizu University. The
author would like to acknowledge that this research is aided by a competitive fund supported by the Ministry of
Education, Culture, Sports, Science, and Technology (MEXT) and the Japan Society for the Promotion of
Science (JSPS), Empirical Social Science Research for the Impending Issue of Japanese Society, Jenda Kakusa
Sensitive na Hatarakikata to Sekatsu no Chowa” (fiscal years 2008–12, Nobuko Nagase, principal
investigator), and the Abe Fellowship (2013–16, , Nobuko Nagase, principal investigator). The use of
microdata from the Japanese Longitudinal Survey of Adults in the 21st Century (2002 Cohort), collected by the
Ministry of Health, Labor, and Welfare (MHLW,) followed the due application process and permissions
required by the Japanese Statistics Law. The author would like to thank Francine Blau, Claudia Goldin, David
Autor, Hugh Patrick, Takatoshi Ito, Elaine McCrate and also the participants of the National Bureau of
Economic Research (NBER) Japan Project Meeting (Tokyo, July 30, 2015), and Karen Eggleston for her
helpful comments.
1

Electronic copy available at: https://ssrn.com/abstract=2965185

East Asian economies experienced an ultra low total fertility rate, of around 1.3 or lower,
in the 2000s. These economies are therefore in search of policies that can positively affectfertility, even though it may not be easy to impact fertility through policy levers. The Japanese
government introduced the Child Care Leave Act in 1991 mandating unpaid parental leave withjob protection from 1992. Beginning in 1994, it also introduced a series of five-year plans called
the “Angel Plan”, “New Angel Plan” and the “Renewed Angel Plan” to increase subsidized day
care to increase fertility by reducing the opportunity cost of children for working mothers.
Despite the series of leave provision enhancements, the labor participation rate of new mothers
in Japan levelled off at around 25 percent after the first childbirth from 1990s to late 2000s,
while marriage and fertility was postponed.
Economic theory predicts that when there is no parental leave, more women will exit theworkforce, and if parental leave is provided, more women who would have quit will return totheir prebirth employer, and thus the labor supply of mothers will increase (Klerman andLeibowits 1997). Evidence confirming this theory was found in empirical studies of different
countries (Ruhm 1998; Waldfogel, Higuchi, and Abe 1999; Berger and Waldfogel 2004; Baker
and Milligan 2008; Lalive and Zweimuler 2009; Han, Ruhm, and Waldfogel 2009). Some studies
found that parental leave and allowance schemes can motivate women to speed up the timing of
fertility (Hoem 1993; Walker 1995; Lalive and Zweimuler 2009), and in some cases also thefertility level itself (Averett and Whitingon [2001] for the United States; Rønsen [2004] for
Finland and Norway, Bjorklund [2006] for Sweden, and Gauthier [2007]). Results for theUnited States using the difference-in-difference method, however, showed that, in many cases,
parental leave had insignificant results on the labor supply (for example, Klerman and Leibowits
1997; Waldfogel 1999; Baum 2003 and Hashimoto et al 2004). Gordon, Løken, Mogstad and2Electronic copy available at: https://ssrn.com/abstract=2965185

Salvances (2016) found for the case of Norway using regression discontinuity approach, thatleave allow longer parental time with children, but impact on female labor supply nor fertility tobe small in the long run. Schonberg and Ludsteck (2014) for Germany also found that the leaveallow more parental time with children, but that long term effect on labor supply was small.
In the case of Japan, despite the introduction of parental leave (in 1992) and theincreasingly generous replacement allowance for parental leave (from 1995), even in the shortterm the labor supply of new mothers showed no significant increase up to the first half of the
2000s. Also, fertility continued to decline until it hit a historic low of 1.26 in 2005.
That Japan’s labor force participation and fertility rate appear unresponsive to thesepolicy initiatives is baffling, especially since many studies using Japanese microdata show thatthe full-time employment of women with children increased when companies provided leave(Higuchi 1994; Morita and Kaneko 1998; Shigeno and Ohkusa 1998; Higuchi and Abe 1999;
Waldfogel, Higuchi, and Abe 1999; Suruga and Cho 2003; Nagase 2003a; Takeishi 2011; Satoand Ma 2008). Some results also found that fertility rose for the working population when
parental leave was provided (Morita and Kaneko 1998; Ministry of Health, Labor, and Welfare2013).
Most Japanese research analyzed only working women and the provision of leave bycompanies, and, as a result, could have a potential bias based on the unobserved differences of
the women who were hired at firms that did provide leave and those that did not. Research on
fertility also might have been biased as it analyzed mostly the working population using
retrospective questions. Studies of working mothers (who were asked about the ease of taking
parental leave in retrospect) may have serious selection issues, since many women who quit3

work to have a child are not included in the analysis. The difference-in-difference method may,
however, be able to overcome the selection problem. Asai (2015) used this method for Japan,
and her focus was on the 2001 increase in leave allowance from 25 percent of the salary to 40
percent; however, she found no significant effect of the policy on maternal labor supply.
Even though women’s entitlement to take leave with job protection is an important
incentive for their continued employment, this paper hypothesizes that for women to choose towork after childbirth, and for employed women to be able to have children, the policy must be
accompanied by a family-friendly workplace culture. This is especially true for a country inwhich group norms and group cultures are strong. Akerlof and Kranton (2000) stated that norms
are important determinants of the utility one derives from one’s own actions and also from theactions of others. Japanese firms have a strong organizational culture requiring the highcommitment of full-time regular workers. At the same time, Japanese society has also placedstrong emphasis on motherhood. Unless the norms at the workplace and at home are changed torecognize mothers as legitimate members of the work team, they will feel penalized at work.
Therefore, the introduction of parental leave alone may not be effective.
To verify the effect of a family-friendly policy, I will use the difference-in-difference
method. In an attempt to change work cultures that are not sympathetic to workers with families,
the government announced that firms with more than 300 employees would be required to set up
action plans to better the work-life balance of their employees. The schemes, of no shorter than
two and no longer than five years duration, had to be registered by 2005 with the local office ofthe Ministry of Health, Labor, and Welfare (MHLW). In 2009, the government announced thatworkers with children under three could request shorter work hours (e.g., six hours a day), and4

that the company could not reject this request without legitimate reasons. This mandate wasapplied to firms with 100 and more employees in 2010, and to all other firms from 2012. This
was a welcome change for full-time mothers who wished for flexible work hours. This paper will
empirically estimate, through natural experiments, the effects of these two policies on thefertility and labor supply of mothers. It will also see whether childless women’s intention to givebirth increased as a consequence of the improved feasibility of balancing work and family.
The remainder of the paper is as follows. Section 2 begin with background informationon the change in law, previous research results and the meaning the law have had against thelong term employment labor market in Japan. Section 3 discusses the estimation methodology
and section 4 describes the data. Section 5 presents the results. The first part of Section 5 deals
with the effects of the two policies on the first childbirth as well as marriage, and then on thesecond and third childbirths. The second part deals with the effect of the short-hour option
mandate on the continuation of work and the weekly work hours following the first childbirth,and the third part on how strong an effect the two policies have had on women’s intention tohave a child. Section 6 discusses the results and concludes the paper.

II.

Background

After the total fertility rate drop to 1.57 in 1989, the Japanese government passed theChild Care and Family Care Leave Act in 1991, hoping to reduce the opportunity cost ofchildren for female workers, and thus encourage women to have both children and careers. Thislaw applied to seishain, full-time employees without termination of contract (called full-time,permanent employees from hereon), and to those with more than one year tenure. It protected5their job during parental leave, which could last till their child reached one year of age. It applied
to both mothers and fathers, though the take-up rate of fathers was near zero. It did not apply toemployees with a fixed-term contract—e.g., of one or two years. The mandate had a grace period
until 1995, when it was extended to smaller enterprises with fewer than 29 employees. Maternity
leave with job security has been available to employees in Japan (including fixed-term
employees) since 1956. Female employees are eligible to take six weeks off before and six
weeks (later extended to eight weeks) after childbirth. The drop in fertility initiated the passage
of a law in 1991 that granted job-protected leave for a maximum period of one year after birth.
Figure 1 shows that the average number of children of married women declined by cohort,especially for those born after 1963.
<Figure 1>
Despite their entitlement to parental leave from 1992 and the passage of Gender Equal
Employment Opportunity Law of 1985, many mothers continued to quit work at marriage or thebirth of their first child, and marriage and birth rates continued to decline. Returning to full-timework with a one-year-old was not easy, especially since full-time workers are expected to take on
many workplace responsibilities. In interviews of workers at large enterprises in the Tokyo
metropolitan and nonurban areas in 1997, Nagase (2006) found that many women were skepticalof taking leave—especially those in the Tokyo area, who do not expect to live with extended
families where parents-in-law can help with child rearing. Some women without children
described how women who returned after parental leave had to apologize to their colleagues
before dashing to daycare centers after work; these childless women did not want to lead thatkind of life. Another woman said she would prefer to be a full-time mother and take good care of6any future children, even though she was not yet ready to leave the workforce because she
enjoyed her single life. In the Japanese long-term employment setting, one is often hired not for a
specific job, but rather for the long term and assigned by managerial initiative to a team. The job
description of an individual worker, therefore, is not clear, and workers who can flexibly cover awide range of work within a given team gain high evaluations (Ishida 1989). The workplace,backed by court law, also expects employees to work overtime whenever required.2 In the 2008
interviews, Nagase and Yamaya (2011) found that because they must put in long hours ofteamwork as well as keep up their homemaking role, many childless women are skeptical of thefeasibility of balancing work and family responsibilities despite the governmental policies
introduced in the early 2000s. The opportunity cost of having children was therefore still high formany women despite the introduction of parental leave. When their children grew older, manymothers who had left the labor market reentered it as “part-time” workers who were paid by thehour and at a much lower rate (Yu 2002; Nagase 1997, 2003b). Therefore, the opportunity costof leaving full-time regular work was high, and women increasingly postponed marriage andchildbirth in the 1990s and 2000s.
One line of reform designed to encourage the use of parental leave was to increase themonetary allowance given during leave. In April 1995, the government started granting a leaveallowance equivalent to 25 percent (5 percent withheld) of the daily salary from employment
insurance. This was increased to 40 percent (10 percent withheld) in January 2001, and to 50
percent (20 percent withheld) from October 2007 to 2010. To incentivize mothers to return totheir prebirth employers, the withheld portion of the allowance was refunded six months after
Supreme Court cases on overtime work ruled that long term employees are to work overtime whenrequired. The effect of such rule on workplace norm and household division of labor is discussed in
Nagase and Brinton (2017).
72

they returned to their original workplace.3 Because the birth rate continued to stagnate, from
April 2010 the government abolished the withheld portion, and after April 2014, the monthly
replacement became 67 percent until a child reached six months and 50 percent thereafter.
The percentage of new mothers in the labor force, however, did not increase despite thispolicy. Figure 2 shows the long-term trend of new mothers in the labor force when their children
turned one. The repeated cross-sectional Japanese National Fertility Survey (1992, 1997, 2002,
2005, and 2010) shows the longest time trend for a five-year average. The percentage of firsttime mothers in the labor force was 23 percent for first births in the late 1980s, 23 percent in theearly 1990s after the introduction of the parental leave, 24 percent in the late 1990s, and 26
percent in the first half of the 2000s. We see that the yearly labor participation average of
mothers with newborns in the Japanese Longitudinal Survey of Adults in the 21st Century (2002
Cohort) (JLSA), followed the trend of the Japanese National Fertility Survey, but the ratio of
mothers in labor force jumped in 2009 and 2010 and further in 2011 and 2012. The 2015
Japanese National Fertility Survey confirmed this upward trend. The percentage of mothers who
had work when their first child turned age one increased from 27.4 percent for births in 2000–04
to 29.1 percent in 2005–09, but jumped to 38.3 percent in 2010–14.
<Figure 2 >Another line of government reform was to offer flexible work hours and encourage asupportive culture within firms to balance work and family. Plus One Measure to Halt the
Declining Birth Rate announced by the MHLW in 2002, pointed out that the “revision of

3

About 85 percent of the leave-takers received the withheld portion, meaning about 15 percent quit work
after taking the leave.
8

working patterns, including men’s” was important. Changing men’s work patterns of putting inlong hours would make it easier for families to have children. When the legislature passed the
Act on Advancement of Measures to Support Raising Next-Generation Children of 2003, thegovernment mandated firms with more than 300 employees to plan their work and family
policies to meet their employee needs and to register a two-to-five-year action plan at local
MHLW offices by 2005. Firms with good practices would be awarded a “kurumin seal” that
could be printed on their products. In late 2007, the government, the main employers’organization, and the National Center of Labor Unions adopted “The Work and Life Balance
Charter.”
The reform, proposed in December 2008 and passed in June 2009, was another large
amendment to introduce flexible work hours for working parents. It mandated a short-hour
option for workers with children under the age of three. Sick leave to care for children,
introduced in 2005, was doubled to ten days for parents with more than one preschool child. In
addition, to encourage fathers to use the parental leave benefit, leave was extended by twomonths for fathers.4 After 2009, fathers were also allowed to take leave during the first eightweeks after a child’s birth and again sometime later. In December 2008, the action plan mandate
for firms was also expanded to companies with more than 100 employees.
With the short-hour option legislated, starting in June 2010, companies with more than
100 employees were mandated to offer workers a six-hour-a-day working option until their childreached age three, and were barred from assigning overtime work to parents of preschool

4This increase in length may not have had much impact in major urban cities, since the law already had aclause extending the leave period by six months in 2005 if it was verified that government-approved
childcare facilities were full, which was often the case in urban centers.
9children. Firms with fewer than 100 employees were given a two-year grace period until July
2012. Therefore, if women working at firms with more than 100 employees had a child in 2009or 2010, they could return to work with the short-hour option and not have to work overtime,
whereas women at firms with fewer than 101 employees would have the same benefits if theywaited until 2011 to have a child.
The action plan register of 2005 and the short-hour option of 2009 were aimed at easing
child rearing for those working full time. These changes might increase marriage and childbirthamong working women if the policy really eases the option of having both a full-time regular job
and a child.
This paper will look at the effects of policies to increase work flexibility on fertility andwork continuation. Our model predicts that the leave policy will have a positive impact on
fertility only when females see that having both a job and a family improves their utility. We will
utilize the “registration mandate” (introduced in 2005) for those employed at firms with 301 or
more employees, and the “short-hour option” (introduced in 2009) for firms with 101 or more
employees.

III.

Conceptual Framework and Estimation Strategy

A. Policy Change
We will use the difference-in-difference method to compare workers at firms with 101 (or 301)
or more employees and those at firms with 100 (or 300) and fewer employees, and see if fertility
or work continuation changed before and after the regulatory changes, controlling for otherfactors such as the mother’s age and educational level.

10It is important to establish the causal effect of the policy on fertility, in light of the factthat leave policy enhancements intending to reduce the cost of quitting work after childbirth haveseemed to exert little influence on labor supply or fertility in the past, and that policymakers aswell as the media are becoming skeptical of the policy’s effectiveness.
By using these policy changes as natural experiments, and by estimating whether asignificant change in birth and labor supply was evident right after the implementation of thepolicy among workers at mandated firms, compared with those at nonmandated firms, we canidentify the causal effect of the policy. Workers at mandated firms (the larger enterprises) may,in their unobservables, be more qualified than workers at smaller firms. Yet, if the change infertility behavior in workers at the larger firms, as compared to those at smaller firms, is evident
right after the implementation of the reform, the change must be due to the policy—not the resultof the self-selection of employees at the mandated firms.
It is important, then, to identify when the employees knew about the reform. Discussionof the short-hour mandate reform started in August 2008, the MHLW announced the policy
proposal in December 2008,5 and the law was passed in June 2009. According to Google trends,
ikuji tanjikan (the short-hour option for childcare) was first discussed as a new term in May
2007, when the short-hour option for public servants was mandated. Use of the term increased
5

The MHLW states that the revision of the leave law was discussed starting with the Cabinet’s adoptionof the New Measure against the Declining Fertility in June 2006, and following the Expert Group Reporton Supporting the Work and Family Life for the Future, which was released in August 2007. The Labor
Policy Council Employment Equality Subgroup discussed leave reform at its 82nd meeting in August
2008. The final report of the National Commission on Social Security (November 2008) stated that thechildcare leave system should emphasize supporting flexible work styles, including shorter working
hours. At the same time, it was necessary that the general workplace reduce long working hours for men(fathers) and encourage them to take childcare leave (www.mhlw.go.jp/english/policy/affiars/dl/05.pdf).
At its 91st meeting in December 2008, the MHLW proposed mandating the short-hour option andimplementing the “no overtime” policy for private employees who had children under the age of three(discussions and papers can be accessed at the MHLW website).
11

from January to March 2009, shortly after the MHLW’s December 2008 announcement of its
policy proposal for the private sector. The law was on the table of the Diet beginning in April
2009, discussed at the House of Representatives on June 12, and passed into law by the House ofCouncilors on June 24, 2009. But by then, because the law was expected to pass, attention had
already halved. In June 2010, when the law was to be implemented, attention again increased. It
can therefore be assumed that the public became aware of the short-time option during late 2008
to early 2009 (see the Google search trend in the Appendix). Since workers were required tohave a one-year tenure before they were eligible for parental leave, they could not have selfselected the mandated firms quickly enough to account for any positive relationship between
childbearing and firm size by 2009 (short-hour option).
It is more difficult to define the policy timing for the mandated firms with 301 or more
employees to make action plans to accommodate work-life balance. Based on the Act on
Advancement of Measures to Support Raising Next-Generation Children of 2003, firms wererequired to make plans that suited the needs of their employees and to register them with thelocal MHLW office by 2005. But because these action plans could vary from two to five years,
and there were no specific requirements for their content, the time periods and content varied byfirm.6 However, in interviews I conducted in 2008 with personnel officers at 11 large enterprises,
many officers said that the mandate resulted in personnel departments strongly recognizing the
Beginning in April 2005, firms with more than 300 employees were mandated to register an action plan to
improve their work environments with the local office of the MHLW. For firms with 101 to 300
employees, the plans were not mandatory, but recommended. The MHLW also started acknowledging
nintei kigyou (approved firms) in 2007, and allowing them to use “kurumin” or family-friendly seals on
their goods and advertisements. To get approval for a kurumin seal, a firm should: have action plans formore than two and less than five years; realize the stated action plan goals; have some measures forworkers having children between three years and school-going age; have at least one male parental leavetaker; and have female take-up of childcare leave exceeding 70 percent.
12need for the higher utilization of female employees and thinking about the future labor force
structure. On December 3, 2008, an amendment to the law ordered firms with more than 300
employees to announce their action plan to the public beginning in April 2009; firms with morethan 100 employees were required to publicly announce the plan in April 2011. This rollout
partly coincided with the short-hour option period. Therefore, I will estimate the policy period
for action plans to be from 2005 to 2008. From 2009 onward, the policy effect of the action plan
mandate will be measured together with that of the short-hour option.
B. Estimation ModelWe can measure the causal effects of the regulations on the childbirth hazard for working
mothers, especially for the 2009 reform, since they need to be employed for at least one year
before being eligible for parental leave and the regulation was enacted only six months after theannouncement. Consequently, if the childbirth hazard rose right after the reform in 2009, it
would not be the selection effect, but rather the effect from the change in the regulation of 2009.
Since marriage go together with childbirth in Japan, we will also estimate the policy effect on
marriage.
The marriage, and the first-, second-, and third-childbirth hazard for women in the labor
force will be estimated for one period. 𝑌1𝑖𝑡 takes 1 among those who got married, or had theirfirst child among those with no children, or second child among those with one child, or thirdchild among those with two children. 𝐻𝑖𝑡 is the vector of covariates, such as educational
attainment and age category dummies, the hourly wage rate is at t-1, and birth intentions are at t1. For the second- and third-childbirth hazard, the log income and domestic work hours of thehusband were included as explanatory variables.
13

We estimate not only the first childbirth but also marriage, as both sometimes occur
simultaneously. In Japan, premarital sexual intercourse has become more socially accepted, but
out-of-wedlock birth still is not. Today, around one-fourth of marriages in Japan occur after theconception of a child, either planned or unplanned. Out-of-wedlock childbirths are still rare (1.63
percent in 2000, 2.15 percent in 2010, and 2.29 percent in 2015) according to the MHLW’s Vital
Statistics. Cohabitation of unmarried females in the age group 18 to 34 is still low (2.8 percent in
1987, rising to 7.6 percent in 2002, but declining to 5.8 percent in 2010, and returning to 7.0
percent in 2015) according to the National Fertility Survey. On the other hand, premaritalconception resulting in marriage (identified by a marital period that is less than the pregnancy
period) was 12.6 percent in 1980, 21.0 percent in 1990, 26.3 percent in 2000, and leveled off at
25.3 percent in 2009. For women in the age group 20 to 24, the figure was over 60 percent in
2009; in the age group 25 to 29, around 25 percent; and the age group 30–34, a little over 10
percent, according to the MHLW’s Vital Statistics Special Report on Childbirth.
𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒100𝑖 𝑡−1 in equation (1) is a dummy variable that applies if one is employed ata firm with 100 and more employees. The short-hour option mandate was applied to those who
were employed at those firms who gave birth in 2009–10 and returned to work after 2010-12.
For births after 2011, the short-hour option was mandated for all employees with children lessthan three years old, regardless of firm size. Thus, we will estimate, using the fixed linear
probability model, that:
𝑌1𝑖𝑡 = 𝑎1 + 𝑏1 𝐻𝑖𝑡 + 𝑐1 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒100𝑖𝑡−1 + 𝑑1 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒100𝑖𝑡−1∗ (𝑦𝑒𝑎𝑟𝑠 𝑓𝑜𝑟 𝑠ℎ𝑜𝑟𝑡 ℎ𝑜𝑢𝑟 𝑜𝑝𝑡𝑖𝑜𝑛 𝑚𝑎𝑛𝑑𝑎𝑡𝑒 𝑝𝑜𝑙𝑖𝑐𝑖𝑒𝑠) + 𝑒1 𝑦𝑒𝑎𝑟 𝑑𝑢𝑚𝑚𝑦+ 𝑢𝑖𝑡 (1)14The action plan mandate for firms with 301 and more employees was announced in
2003, while the registration mandate took effect in 2005. Since the timing ambiguities may makeassessing the action plan mandate more difficult, the effect of the 2009–10 policy will be
estimated first, and then in another regression, we will add cross-terms of firm size of more than
300, 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒300𝑖 𝑡−1 crossed with years 2005 to 2008 as in equation (2). Due to the firm-size
categories asked in the questionnaire, we will use 100 instead of 101 and 300 instead of 301 forthe firm size.

𝑌1𝑖𝑡 =
𝑎2 + 𝑏2 𝐻𝑖𝑡 + 𝑐2 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒100𝑖𝑡−1 + 𝑑2 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒100𝑖𝑡−1 ∗(𝑦𝑒𝑎𝑟𝑠 𝑎𝑓𝑡𝑒𝑟 𝑠ℎ𝑜𝑟𝑡 ℎ𝑜𝑢𝑟 𝑜𝑝𝑡𝑖𝑜𝑛 𝑚𝑎𝑛𝑑𝑎𝑡𝑒 𝑝𝑜𝑙𝑖𝑐𝑖𝑒𝑠)
𝑒2 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒300𝑖𝑡−1 + 𝑓2 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒300𝑖𝑡−1∗ (𝑦𝑒𝑎𝑟𝑠 𝑎𝑓𝑡𝑒𝑟 𝑎𝑐𝑡𝑖𝑜𝑛 𝑝𝑙𝑎𝑛 𝑚𝑎𝑛𝑑𝑎𝑡𝑒 𝑝𝑜𝑙𝑖𝑐𝑖𝑒𝑠)+𝑔2 𝑦𝑒𝑎𝑟 𝑑𝑢𝑚𝑚𝑦 + 𝑢𝑖𝑡 (2)If 𝑑1 in equation (1) and 𝑑2 in equation (2) is significantly positive statistically, we willknow that the short-hour option increased the number of childbirths and marriages. If 𝑓2 inequation (2) if significantly positive statistically, we will know that the action plan mandate
increased the number of childbirths.
As a next step, difference-in-difference-in-difference will be estimated to see thevarying effects of the short hour option mandate policy. The policy should affect those who had
their first child at the treated firms after the policy enactment. 𝑌2𝑖𝑡+1 is work continuation as afull-time permanent employee and the weekly hours worked in the following year. If the policy
15

is effective, the work hours t+1 of women who had a newborn at t should become shorter at thetreated firms with the short-hour option mandate, and also work continuation as a full-timepermanent employee at t+1 of these same women should be higher at the treated firms. 𝑑3 inequation (3) should be statistically significant if the policy especially affected those females who
were planning for their first child.
𝑌2𝑖𝑡+1 = 𝑎3 + 𝑏3 𝐻𝑖𝑡 + 𝑐3 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒𝑖𝑡−1 + 𝑐4 𝑓𝑖𝑟𝑠𝑡 𝑐ℎ𝑖𝑙𝑑𝑏𝑖𝑟𝑡ℎ𝑖 𝑡+𝑐5 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒𝑖𝑡−1 ∗ 𝑓𝑖𝑟𝑠𝑡 𝑐ℎ𝑖𝑙𝑑𝑏𝑖𝑟𝑡ℎ 𝑖 𝑡 +𝑐6 𝑓𝑖𝑟𝑠𝑡 𝑐ℎ𝑖𝑙𝑑𝑏𝑖𝑟𝑡ℎ𝑖 𝑡 ∗ (𝑦𝑒𝑎𝑟𝑠 𝑎𝑓𝑡𝑒𝑟 𝑒𝑛𝑎𝑐𝑡𝑚𝑒𝑛𝑡 𝑜𝑓 𝑝𝑜𝑙𝑖𝑐𝑖es)+𝑐7 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒𝑖𝑡−1 ∗ (𝑦𝑒𝑎𝑟𝑠 𝑎𝑓𝑡𝑒𝑟 𝑒𝑛𝑎𝑐𝑡𝑚𝑒𝑛𝑡 𝑜𝑓 𝑝𝑜𝑙𝑖𝑐𝑖𝑒𝑠)+ 𝑑3 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒𝑖𝑡−1 ∗ 𝑓𝑖𝑟𝑠𝑡 𝑐ℎ𝑖𝑙𝑑𝑏𝑖𝑟𝑡ℎ𝑖 𝑡 ∗ (𝑦𝑒𝑎𝑟𝑠 𝑎𝑓𝑡𝑒𝑟 𝑒𝑛𝑎𝑐𝑡𝑚𝑒𝑛𝑡 𝑜𝑓 𝑝𝑜𝑙𝑖𝑐𝑖𝑒𝑠) +𝑒3 (𝑦𝑒𝑎𝑟 𝑑𝑢𝑚𝑚𝑦 𝑖𝑛𝑐𝑙𝑢𝑑𝑖𝑛𝑔 𝑦𝑒𝑎𝑟𝑠 𝑎𝑓𝑡𝑒𝑟 𝑒𝑛𝑎𝑐𝑡𝑚𝑒𝑛𝑡 𝑜𝑓 𝑝𝑜𝑙𝑖𝑐𝑖𝑒𝑠) + 𝑢𝑖𝑡 (3)C. Parity-Specific Effects, Childlessness, and Birth Intention
Policies to change work culture should have had the strongest impact on women who wished tohave a child and continue to work, but hesitated because workplace norms did not support
women with children taking on responsible work, or because work hours were long. In Japan in
the past, around 40 percent of women left the workforce upon marriage and another 40 percent
after the birth of their first child. But the large adjustment ends mostly at the first childbirth, asevidenced in the Japanese National Fertility Survey (Nagase 1999). Figure 3, which uses theJapanese Longitudinal Survey of Adults in the 21st Century (2002 Cohort) (the data this paper
uses for its analysis), shows a similar picture for the period 2002–10: leaving the workforce at16

marriage and at the first childbirth is much more prevalent than leaving the workforce at the birthof the second child.
<Figure 3 >Therefore, the change in work culture may have the largest impact on women who hope
to work as full-time regular employees after marriage and after having their first child. The work
culture should also be important for the second and the third birth, but other factors, such as thehusband helping with the child rearing, characteristics of the marital relationship, and theavailability of daycare centers may be of equal importance to working mothers. Since we havequestionnaires on husbands’ domestic work hours on weekdays and on weekends in minutes, wemade husbands’ weekly and weekend domestic hours as explanatory variables by dividing themby 60 to estimate the second- and third-childbirth hazard. We also included the log of thehusband’s income in 10,000 yen at t-1 as an explanatory variable for the second and thirdchildbirth to account for the nonlabor income of the wives.
As for explanatory variables other than firm size and policy years, we have educational
attainment to account for differences in human capital, and year dummies to account forperiodical influences such as economic fluctuations. Age dummies were also included ascontrols, since childbirth is related to age by biological limitations at the higher end andschooling and social norms at the lower end. Logs of hourly wages of females are also included
to account for both the opportunity cost of time and also the available income.
We will also focus on women’s intention to have a child to see if fertility declined
because more women did not want a child or because they were constrained in their wish. The
17

following question was asked of all respondents every year, “Do you want to have any or anotherchild?” The response options were “definitely yes,” “yes,” “cannot say,” “no,” and “definitely
no.” We made a dummy variable of 1 for strong intention of child when the respondent answered“definitely yes.”

IV.

Data

The paper will use the Japanese Longitudinal Survey of Adults in the 21st Century(2002 Cohort), here called the JLSA, a nationally representative panel survey that follows
cohorts of Japanese youth and was collected by the MHLW. Beginning in the first week ofNovember 2002, the JLSA has collected yearly information on labor market experiences,
housework hours, birth and marriage intent and outcome, and the background characteristics ofpeople between the ages of 20 and 34 and their spouses. They are interviewed annually, and thispaper uses up to the eleventh wave surveyed in 2012. These are data on cohorts born from 1967
to 1982, who were 20 to 34 years of age in 2002, and 30 to 44 years of age in 2012. We can thus
follow their family formation. The original sample contained 14,150 females. The effective
response rate for the first year was 82.8 percent, and the follow-up rates were 82.2, 85.1, 87.9,
89.0, 90.0, 91.3, 92.4, 85.5, 82.4, and 82.0 percent respectively for the following years. These
data allow us to examine women of child-rearing age and how they responded to the change inthe parental leave law.
The panel structure allows us to control for individual differences in unobserved
preferences and individual abilities. Birth timing may differ by unobservables, such as the desire
for children and fecundity. The advantages of these data are the large sample size and high18

response rate. Other existing panel data in Japan, such as Panel Data on Consumers, the KeioHousehold Panel Survey (KHPS), or the Japan Household Panel Survey (JHPS) are smaller, witha lower response rate in the initial year as compared to the JLSA. These data have not been
explored until very recently owing to restrictions on the use of microdata imposed by thegovernmental statistics law.7
The shortcoming of these data is that they start in 2002. Even though we haveretrospective data on past childbirths and marriages, we have no information on past parental
leave use, birth intent, and other variables, so we can only estimate the impact on behavior of law
changes after 2002. For the purpose of this analysis, we selected a sample of people who were
working.

V.

The Results

A. Effect of Action Plan Mandate and the Short-Hour Option on Marriage and ChildbirthFigure 4 shows the first-childbirth hazard before and after the law mandate. The red line shows
the result for firms with less than 100 employees, and the blue line for firms with 100 and more
employees. In 2009–10, employees at firms with 100 and more employees were given the option
to work short hours till a child reached the age of three. The fertility hazard seems to have risen
for women working at such firms (the blue line) as compared to those without the option (the redline). Interestingly, in 2011–12, when employees of all the firms were given the option to work
short hours, the first-childbirth hazard increased further for employees of both firms (as shownby the red line and blue lines). We need to take into effect other factors to verify the effect of thepolicy. Since in 2003, we had a group of women aged 21 to 35, while in 2012, they were 30 to7

Even today, one needs to go through a long application process and it takes time to get the permission and theproper documents. The term of use is also restricted.
19

44, I controlled the age of the females to be 30 to 35 so that I could have the same age group forevery year. This control was made since childbirth is strongly connected to age, and the agegroup 30 to 35 was the only age group that was available as common. However, I added results
for a wider age group of 25 to 37 in the appendix, which were likely ages for having a first childin the surveyed sample, and the general difference in trends between the treatment and control
group is also evident in this age group as well.
＜Figure 4>
Table 1 shows the effect of the 2005 and 2009 policies on marriage and on the firstchildbirth, while controlling for the woman’s age, year, educational attainment, log hourly wageof the previous period, and strong intentions to have a child.
The first and the second column show that the short-hour option policy had asignificantly positive effect on marriage. It raised marriage hazard by around 2 percent, while theeffect of the action plan mandate was nonsignificant, as estimated by the linear probability model.
The yearly marriage rate during the survey years averaged around 5.8 percent for those who were
working at t-1. Therefore, the 2 percent rise can be considered substantial.
The remaining columns show the effect on the first-childbirth hazard. The short-hour
option policy had a significant effect also on the first childbirth, while the action plan mandate
again had no significant effect. Women working at firms with 300 and more employees were lesslikely to have any children. However, after controlling for the woman’s age, year, educational
attainment, birth intent at t-1, log hourly wage rate at t-1, and marital status, the first childbirth ofchildless women at firms with the short-hour option mandate increased from 1.0 to 1.2 percent in20

2009 to 2010, as estimated by a fixed-effect linear probability model. When the marriage dummy
was included, the magnitude of the effect became smaller. A strong intention to have a child in
the previous period exerted a significant influence on marriage and also on the first birth. We
found that the short-hour option increased the first childbirth, both directly and also indirectly byincreasing marriage. The average first-birth hazard during this period was 2.9 percent for those
who were working at t-1. Therefore, the policy effect of the short-hour option mandate on firstchildbirths can be seen as significant and large—a 33 percent increase in first childbirths.
The base year for year dummies is 2003. Since we used 2002 data to obtain informationon the previous year, the year dummy starts from 2003. It was the year when a bad economy
raised the unemployment rate to 5.24 percent. The rate went down to 3.98 percent in 2008, butjumped to 5.06 percent in 2009 after the economic stagnation that followed the world financial
crisis. Despite the upturn and then the downturn of the economy, the birth hazard for working
women continued to rise as years went by, as shown in the positive significant signs of the year
dummy for marriage and the first-childbirth hazard. The effect of the short-hour option will be
included in the 2011 and 2012 dummies after 2011, as the short-hour option will be available tosmaller firms as well, and the coefficients on dummies were significantly positive.
While higher hourly wages do not exert any influence on marriage, we found the same
variable significantly discourages the first-childbirth hazard.
< Table 1>
Table 2 shows the effect of the action plan registration mandate and the short-hour
option mandate on the second- and third-childbirth hazard. We see that neither of the cross-terms
21

of firm size and the 2005–08 dummy nor the 2009–10 dummy were significant in all of theestimates. While the short-hour option policy significantly increased the probability that working
women with no children would have their first child, the policy was not significant for a second
or a third childbirth. On the other hand, the effect of husbands’ weekend domestic work hours on
the second childbirth was significant and large. It was found that the increase in husbands’
weekend domestic work contribution at t-1 goes far toward predicting whether a working woman
will have a second child the following year or not. Husbands’ higher incomes at t-1 alsosignificantly increased the second-childbirth hazard.
On the other hand, none of the stated variables had any significant effect on the thirdchildbirth hazard.
< Table 2>B. Effect of the Action Plan Mandate and Short-Hour Option on Work Hours and Full-time
Permanent Work Status Following the First Childbirth
In order to look at the effect of the policy on labor supply, we will make a difference-indifference-in-difference estimate of the policy, to see whether the policy affected the take-up of
full-time permanent work following the first child for workers at the treated firms than those at
the control firms. To avoid collinearity, we will only look at the effect of the short-hour option.
The analysis was conducted for those who had no children at t-1 by the linear probability fixedeffect model. Full-time permanent work status at t+1 was compared with those who had the firstchildbirth at t at the treated firms and those firms without the policy effect. We found thatwomen who had a firstborn were significantly less likely to continue to work as full-timepermanent employees in the next period, but working at larger firms encouraged their job
22

continuation. Gender values, such as wanting to share the income burden with their husbands
equally, significantly increased such employment. After controlling for such factors, the greyed
row in Table 3 shows whether the policy had a significant effect on the full-time permanent
employment of the women at t+1 when they had a firstborn at t at firms that were affected by thepolicy. The sign of the cross-term of firm size, year, and the first childbirth was significantly
positive, an increase of 13.3 percent, while the average was 43 percent, indicating that the shorthour mandate increased full-time permanent work following the first childbirth by around 30
percent.
<Table 3>
Table 4 estimates the weekly work hours at t+1 of women who had no children at t-1.
We will see whether the weekly work hours of those who had their first child at t became shorter
after the short-hour option mandate. The result shows that women employed at firms with morethan 100 employees work significantly longer hours than those working at smaller firms, and thework hours are reduced after the first childbirth. After controlling for such effects, the sign of thecross-terms of the firm size, year, and the first childbirth were significantly negative, indicatingthat work hours decreased at firms that had the short-hour option mandate following the firstchildbirth, and became around 3.4 hours shorter per week according to the estimate.
<Table 4>
We found that the short-hour option increased full-time permanent employment
following the first childbirth, while reducing the weekly work hours. However, we have to addthat the explanatory power of the equation is low.
23

C. Birth Intent among Childless Women and Unmet Demand for Children
Strong intentions to have a child need to be further explored. Female fecundity declines with age,especially in the late thirties. Therefore, for those who definitely want but have been postponinga child, the mid-thirties may be a good time to consider their schedule.
Figure 5 shows the percentage of women who have a child or children at ages 35 to 36.
Fixed-term workers, who have only limited access to parental leave entitlement, compose thesmallest percentage of those with children: 37 percent as of 2009–10. Full-time regular workers,
permanent full-time workers, or seishain, follow at 45 percent, and part-time workers (mainly
workers hired and paid by the hour) come next with 60 percent. Those out of the labor force havethe highest percentage of motherhood at ages 35 to 36: 81 percent.
<Figure 6>
A strong intent to have a child was expressed by 35 percent of childless, permanent fulltime regular workers (seishain), and by 24 percent of childless females who were out of the labor
force on average. When we see this stronger desire for children, even though there is higher
childlessness among full-time, regularly employed 35–36 year old females (such as seishain and
fixed-termed workers), it indicates that they have a preference for children, but their demand isunmet.
Reasons for the unmet demand for children can be various, for example, not meeting theright partner, or waiting for the right time to have a child. It could also be difficulty in balancing
work and family responsibilities.

24

We will examine the unmet child demand by looking into the change in the strong
intention to have a child, 𝑌3𝑖𝑡 , for the working population without any child. The group that
replied that they definitely wanted a child is a dependent dummy variable. This paper will see
whether the policy change not only influenced the birth timing but also whether it increased thebirth intent itself. If 𝑑4 in equation (3) is positive for childless females, it shows that the reform
increased their desire for children by reducing the child cost. 𝑋𝑖𝑡 is the vector of covariates, suchas educational attainment, log of hourly wage at t-1, and age category dummies. The intent will
be regressed by the fixed-effect linear probability model, with the difference-in-difference
setting, to see whose birth intention is most affected by the policy change.
𝑌3𝑖𝑡 = 𝑎2 + 𝑏2 𝑋𝑖𝑡 + 𝑐2 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒𝑖𝑡−1 + 𝑑4 𝑓𝑖𝑟𝑚𝑠𝑖𝑧𝑒𝑖𝑡−1∗ (𝑦𝑒𝑎𝑟 𝑎𝑓𝑡𝑒𝑟 𝑡ℎ𝑒 𝑚𝑎𝑛𝑑𝑎𝑡𝑒 𝑜𝑓 𝑝𝑜𝑙𝑖𝑐𝑖𝑒𝑠)𝑒3 ∗ 𝑦𝑒𝑎𝑟 𝑑𝑢𝑚𝑚𝑦 + 𝑢𝑖𝑡 (4)Table 5 is the result of the linear probability fixed-effect model of strong desire to havea child among childless working women. We would like to see if the natural experiment of
2005–08 and 2009–10 increased the strong desire among those without children.
We find the action plan mandate increased women’s strong desire to have a child by 2.1
percent and the short-hour option by 2.0 percent. The percentage of those surveyed who
definitely wanted a child was on average 32 percent. This means the two policies increased birthintent by around 12 percent. Another factor affecting the strong demand for children is awoman’s age. The strong desire decreases with age. The wage rate did not exert any influence on
the birth intent.
25

The significant effect of policy implies that for many working women, having a child isless attractive when the work environment lacks family-friendly practices. When the work
environment changed so women could better handle work and family responsibilities, a larger
fraction of childless working women expressed their strong desire for a child, which is a goodpredictor of childbirth in the next year (see Table 1). Therefore, increasing the attractiveness of
having a child should help to increase the number of first childbirths in the long run.

VI.

Concluding Remarks

Despite a series of enhancements in parental leave law, childbirth has continued to bedelayed in Japan for the past 20 years, and the number of births within the same age group has
continued to decline for younger cohorts. Additionally, the proportion of females who returned
to a prebirth employer did not show any significant increase in the same period, despite favorable
law changes. Because of long-term employment practices that predict a large drop in wages aftera worker quits long-term employment, along with long and inflexible work hours, more women
prefer to delay childbirth. The favorable law change after 2009 was not enough to prompt
women to have a child while continuing to work until new laws (that increased work flexibility
among long-term, regular workers with a newborn) were implemented.
This paper shows the importance of organizational and cultural changes that increase
work flexibility by using the natural experiment of the two laws that increased work hour
flexibility (passed in 2003) to mandate the action plan register (by 2005) and the short-hour
option (proposed in late 2008 and legislated in June 2009). We used the largest and best-suited
panel data in Japan for this purpose.
26

Using these natural experiments that vary by firm size, we estimated the effect on
fertility and job continuation using a linear probability fixed-effect model. The results showedthat the first-childbirth hazard effectively went up in the 2009–10 period for those working at
firms with more than 100 employees who can use the short-hour option after their return fromparental leave. The effect of the registration mandate of 2005, however, was not significant. The
short-hour option also significantly increased marriage in the 2009–10 period at the treated firms.
We also found that during the policy period, a strong intention to have a childsignificantly increased among childless working women in the treated firms. The result can beinterpreted as a new “flexibility” in work hours that made balancing work and family a more
possible and more attractive option. The increase in the child intention occurred not only
alongside the short-hour option but also with the action plan mandate.
While the policy significantly increased women’s first childbirth and marriage, as welltheir intention to give birth, it did not show any significant impact on the second or thirdchildbirth. The husband’s contribution to domestic work and income level were importantfactors in deciding which working women opted for a second child.
This delay in the first childbirth may partly explain why the gap in the proportion ofworking mothers stayed about the same from the 1980s to the early 2000s—in contradiction to
the findings of previous research, that parental leave entitlement increased mothers’ return toprebirth employers. Since a substantial fraction of women were delaying the birth of their firstchild, and, up to the early 2000s, many first childbirths occurred after women quit their job, thetime series data showed little change until very recently in the fraction of women with and27

without work after the first childbirth, while fertility declined. When the prospect of balancing
both work and family improved, delayed birth among the working population made an upturn.
The change in climate occurred slowly, along with a series of efforts such as the
adoption of the work and life balance charter by businesses, unions, and government, as well aswith changes in the parental leave law, the short-hour option, and publicity around firms’
mandated action plans.
Yet, we have to add that while the proportion of women who choose to continue work
while raising children is increasing, it remains still a small fraction of females in Japan. On the
one hand, the portion of women who have a full-time permanent employment contract without
contract termination upon graduation is decreasing, and on the other, the portion of women witha fixed-term contract has been rising from the late 1990s and 2000s. The latter have much
weaker leave entitlement and no job protection. After considering that most of the regulation andprotection extends only to long-term, regularly employed workers, companies may well increase
this type of employment.
The evidence from Japan shows that parental leave, if not easy to take advantage of,may not in fact increase fertility. On the contrary, it may even cause a delay in fertility. Only
after a series of mandates exerted strong pressure on firms, combined with companies’ owninternal efforts to change the work climate and increase work flexibility (as evidenced inqualitative researches), did the laws finally show an impact on women’s job continuation andfertility. However, there is still much unmet desire for children. Further steps to increase work
flexibility, so that Japanese women can combine work and family, and so that men can be more
involved in domestic work, should be one of the measures undertaken to help fill the unmet
28demand in Japan’s fertility rate. The effect of the constraint caused by the inadequate number ofsubsidized daycare facilities should be pursued in future research.
The analyses offered in this paper are limited by the small number of years that havepassed since the reforms. We need to see if fertility went up permanently, or if it only changed
the timing of childbirth. Whether the reforms truly eased constraints on having both work andfamily, or whether they only released some of the long-awaited demand for children is yet to be
determined through further developments and the release of panel data gathered after 2012. We
do, however, see in the Japanese Labor Force Survey a further increase in maternal labor supply
in 2013 to 2015 related to the “womanomics” policy as analyzed by Nagase (2017).

29

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33

2.4

1948-1952

1.9

1953-1957
1958-1962

1.4

1963-1967

0.9
0.4

1968-1972
1973-197720～24歳 25～29歳 30～34歳 35～39歳 40～44歳 45～49歳
1978-1982

Figure 1
Decline in the Average Number of Children of Married Women by Cohort
Source: IISPR Statistics on Population.

34

Figure 2
Percentage of Women in the Labor Force Whose First Child is Age Zero to One
Source: IISPR Japanese National Fertility Surveys of 1992, 1997, 2002, 2005, and 2010, surveyed a cross-section of women
under age 49, which is shown as a five-year average for 1985–89, 1990–94, 1995–99, 2000–04, 2005–09, and 2009 until early
June, as the survey was conducted in June 2009. The yearly data from 2002 are calculated by the author using the panel data of
the MHLW’s JLSA in the 21st Century (2002 Cohort) of females born in the period 1967 to 1982.

35

Figure 3 Change in Female Labor Status at Major Life Events
Source: Calculated by the author using the data of the MHLW’s JLSA in the 21st Century (2002 Cohort) for marriages and births
that occurred during 2002–10.

36

women age 3035 childless ayear before

Firm size over 100

Firm size less than 100

7%
5%
4%

6%

5%

5%

4%

4%

3%

2003

2004

2005

2006

2007

6%
5%

6%
6%

3%
3%

2%

7%
7%
6%

2008

2009

2010

2011

2012

Figure 4
The Ratio of Women Who Had Their First Childbirth in the Surveyed Year; Shown by Firm Sizeand Surveyed Years
Source: Calculated by the author using the data of the MHLW’s JLSA in the 21st Century (2002 Cohort). In 2009–10, firms withmore than 100 employees were mandated to offer the short-hours option to their employees till their children reached the age ofthree. In 2011–12, all firms were mandated to implement the short-hours option.

37

Table 1
The Effect of the Short-Hours Option (2009) and Action Plan Mandate (2005) on Marriage andthe First-Childbirth Hazard Using the Linear Probability Model
Marriage Hazard ofWorking Females

20-22
base age over 39
23-24
25-26
27-28
29-30
31-32
33-34
35-36
37-38
2004
base year 2003
2005
2006
2007
2008
2009
2010
2011
2012
high child intention
Log wage (t-1)
firm size 300 & over (t-1)
firm size 300 & over(t-1)*(2005 to 2008)
firm size 100 & over (t-1)
firm size 100 & over(t-1)*(2009 to 2010)high school base middle school and other school
junior college or vocational school
university
graduate school
constant
number of obs
number of groups
R2
withinbetweenoverallcoefficient t value
0.031
0.80
0.047
1.35
0.063
2.01 **
0.077
2.81 ***
0.081
3.50 ***
0.072
3.79 ***
0.056
3.67 ***
0.039
3.42 ***
0.025
2.94 ***
0.012
2.52 **
0.030
4.70 ***
0.048
6.04 ***
0.058
5.84 ***
0.080
6.67 ***
0.072
5.06 ***
0.087
5.32 ***
0.085
4.99 ***
0.102
5.46 ***
0.017
3.10 ***
0.002
0.76

0.002
0.019
0.046
-0.028-0.009-0.002-0.06632449
6966
0.02050.00160.00360.42
2.44 ***
1.11
-0.77
-0.30
-0.05
-1.48

Notes: * <0.1 ; ** <0.5; ***<0.01. Standard errors were corrected for clustering.

38

First Childbirth Hazardof Working Femaleswith Action Plan
Mandate and Short
Hour Option
coefficient t value coefficient t value-0.024 -0.99-0.026 -1.05-0.028 -1.28-0.029 -1.32-0.023 -1.19-0.024 -1.24-0.017 -1.00-0.018 -1.04
0.000 -0.03-0.001 -0.06
0.012 1.01
0.012 0.98
0.018 1.88 *0.018 1.86 *0.022 2.95 ***0.022 2.92 ***0.013 2.39 **0.013 2.29 **0.017 6.37 ***0.018 6.39 ***0.029 7.51 ***0.031 7.58 ***0.038 7.64 ***0.040 7.75 ***0.046 7.35 ***0.047 7.44 ***0.049 6.45 ***0.050 6.57 ***0.055 6.20 ***0.055 6.18 ***0.057 5.52 ***0.057 5.51 ***0.074 6.69 ***0.074 6.65 ***0.073 6.12 ***0.072 6.07 ***0.012 3.01 ***0.012 2.92 ***-0.011 -4.68 ***-0.010 -4.44 ***-0.027 -7.38 ***-0.004 -1.10-0.004 -1.30
0.002 0.72
0.012 2.14 **0.012 1.98 **-0.002 -0.09-0.004 -0.13-0.014 -0.67-0.013 -0.60
0.020 0.87
0.020 0.87
0.004 0.12
0.006 0.18
0.068 2.42 **0.070 2.49 **
32449
32449
6966
6966
0.03870.04120.0111
0.008
0.00370.0045First ChildbirthHazard of Working
Females with Short
Hour Option

Table 2
The Effect of the Action Plan Mandate and Short-Hours Option on the Second- and ThirdChildbirth Hazard Using the Linear Probability Model
Second Childbirth Hazard of Working Females

20-22
base age over 39
23-24
25-26
27-28
29-30
31-32
33-34
35-36
37-38
2004
base year 2003
2005
2006
2007
2008
2009
2010
2011
2012
high child intention(t-1)
weekday husband's domestic work hour(t-1)
weekend husband's domestic work hour(t-1)
log husband's income(t-1)
firm size 300 & over(t-1)*(2005 to 2008)
firm size 100 & over (t-1)
firm size 100& over (t-1)
firm size100 & over(t-1)*(2009 to 2010)log of wife's wage (t-1)
high schoolbase middle school and othe school
junior college or vocational school
university
graduate school
constant
number of obs
number of groups
R2
withinbetweenoverall

Third Childbirth Hazard of Working Females

coefficient t value
coefficient t value
coefficient t value
coefficient t value-0.801-5.16 ***
-0.799 -5.15 ***-0.424-4.71 ***
-0.421-4.69 ***
-0.451-3.04 ***
-0.451 -3.04 ***-0.346-2.42 **
-0.348-2.43 ***
-0.522-4.49 ***
-0.521 -4.47 ***-0.199-2.49 **
-0.199-2.51 ***
-0.344-3.79 ***
-0.342 -3.77 ***-0.107-3.07 ***
-0.106-3.05 ***
-0.190-2.74 ***
-0.190 -2.73 ***-0.052-2.56 **
-0.051-2.49 ***
-0.077-1.44-0.077 -1.43-0.025-1.60-0.024-1.54-0.030-0.72-0.030 -0.71-0.011-1.03-0.011
-0.99
0.033
1.08
0.033 1.10
0.002
0.25
0.002
0.27
0.025
1.17
0.026 1.19
0.003
0.49
0.002
0.47
0.138
5.04 ***
0.136 5.01 ***0.017
1.67 *
0.018
1.74 *
0.125
4.36 ***
0.131 4.38 ***0.027
2.44 **
0.030
2.67 ***
0.122
3.9 ***
0.128 3.92 ***0.025
2.36 **
0.028
2.58 ***
0.117
3.26 ***
0.124 3.33 ***0.024
2.20 **
0.027
2.43 **
0.137
3.44 ***
0.143 3.50 ***0.028
2.29 **
0.031
2.48 ***
0.140
3.23 ***
0.142 3.22 ***0.029
2.27 **
0.031
2.40 **
0.163
3.47 ***
0.166 3.49 ***
0.022
1.62
0.023
1.76 *
0.181
3.75 ***
0.180 3.72 ***0.034
2.56 **
0.035
2.64 ***
0.208
4.28 ***
0.207 4.26 ***0.031
2.30 **
0.032
2.38 **
0.005
0.16
0.006 0.20
-0.009-0.41-0.009
-0.41
0.002
0.26
0.002 0.27
0.000
1.10
0.002
1.04
0.006
2.58 ***
0.006 2.56 ***
0.000
-0.50
0.000
-0.46
0.044
2.23 **
0.045 2.26 **-0.004-0.87-0.004-0.90-0.027 -1.15-0.027-1.15-0.023 -1.05-0.016-2.03-0.002-0.1-0.037 -1.45-0.003-0.58-0.006-0.76-0.031-1.25
0.009 0.41
-0.003
-0.49
0.003
0.42
-0.005-0.43-0.005 -0.40
0.001
0.25
-0.005-0.66
0.075
3.73 ***
0.057 2.38 **
0.083
4.71 ***
0.083
4.74 ***
0.113
2.37 **
0.104 2.18 **
0.030
2.47 **
0.029
2.45 ***
0.029
2.25 **
0.029
2.26 **-0.2983420
1239
0.0962
0.05350.0102-1.85 *

-0.290 -1.82 *
3420
1239
0.0971
0.05310.0095

Notes: * <0.1 ; ** <0.5; ***<0.01. Standard errors were corrected for clustering.

39-0.0267357
1885
0.02300.03000.0055-0.63-0.0257357
1885
0.00450.05350.0102-0.63

Table 3
The Effect of Short-Hour Option Mandate on the Permanent Full-Time Employment of Womenat the Treated Firms One Year after They Had Their First Child

20-22
23-24
25-26
27-28
29-30
31-32
33-34
35-36
37-38
2004
2005
2006
2007
2008

base age over 39base year 2003

Policy(2009-2011)
1st childbirth(t)firmsize 100 & over (t-1)
1st childbirth(t) * firmsize100 & over (t-1)
1st childbirth(t) * Policy
firm size 100 & over (t-1) * Policy
firm size 100 & over (t-1) * 1st childbirth(t)*Policy
want to equally burden household income with husband
want to equally burden child care with husband
other schoolbase middle school
high school
junior college or vocational school
university
graduate school
constant
number of obs
number of groups
R2
withinbetweenoverall
Notes: <0.1 ; ** <0.5; ***<0.01. Standard errors were corrected for clustering.

40

coefficient
0.049
0.090
0.068
0.051
0.035
0.017
0.015
0.000
-0.001
0.036
0.033
0.019
0.023
0.020
0.007
-0.0570.112
0.011-0.080
0.016
0.133
0.018
0.002
0.036
-0.216
0.090
0.131
0.418
0.262
22458
5697
0.04120.08620.0703t value
1.15
2.50 *
2.15 **
1.84 *
1.45
0.82
0.81
-0.02
-0.11
4.42 ***
3.20 ***
1.61
1.70 *
1.29
0.39-4.61 ***
10.91 ***
0.40
-3.43 ***
1.55
3.26 ***
1.94 *
0.22
0.29-1.72 *
0.80
1.14
2.78 ***
2.47 **

Notes : *

Table 4
The Effect of the Short-Hour Option on the Work Hours of Women at the Treated Firms One
Year after They Had Their First Child

20-22
23-24
25-26
27-28
29-30
31-32
33-34
35-36
37-38
2004
2005
2006
2007
2008

base age over 39base year 2003

Policy(2009-2011)
1st childbirth(t)firm size 100 & over (t-1)
1st childbirth(t) * firm size 100 & over (t-1)
1st childbirth(t) * Policy
firm size 100 & over (t-1) * Policy
firm size 100 & over (t-1) * 1st childbirth(t)*Policy
Log of wage (t-1)
other schoolbase middle school
high school
junior college or vocational school
university
graduate school
constant
number of obs
number of groups
R2
withinbetweenoverallcoefficient
-2.48
-0.87
-0.88
-1.26
-1.72
-1.62
-1.36
-0.94
-0.26
-0.22
1.37
-0.21
0.31
0.01
0.32
-18.52
2.54
15.84
11.74
-0.57
-14.43
1.55
-5.22
-5.91
-1.72
-3.23
-4.33
31.57
13772
3899
0.02700.01950.0164

Notes: * <0.1 ; ** <0.5; ***<0.01. Standard errors were corrected for clustering.

41

t value
-1.24
-0.54
-0.63
-1.04
-1.65 *
-1.81 *
-1.86 *
-1.63
-0.61
-0.56
3.40 ***
-0.44
0.56
0.02
0.31
-3.66 ***
4.08 ***
3.08 ***
1.67 *-0.75-2.02 **
6.28 ***-1.78 *
-1.76 *
-0.80
-4.25 ***
-0.54
12.48 ***

Figure 5
Women Who Have Children at Age 35–36, by Work Status

Percentage with Any Child at
Age 35 to 36
full-time seishain (n=2665)

out of labor force(n=3485)

termed full-time(n=752)

part-time(n=2555)

85%
69%

83%
72%

83%

81%

68%
60%

47%
36%

46%
36%

42%
37%

45%
37%

2003-2004

2005-2006

2007-20082009-2010

Source: Calculated by the author using the MHLW’s JLSA in the 21st Century (2002 Cohort).

42

Table 5
The Effect of Two Policies on Women’s Strong Intention to Have a Child

20-22
base age over 39
23-24
25-26
27-28
29-30
31-32
33-34
35-36
37-38
2004
base year 2003
2005
2006
2007
2008
2009
2010
2011
2012
firm size 300 & over (t-1)
firm size 300 & over (t-1)*(2005 to 2008)
firm size 100 & over (t-1)
firm size 100 & over (t-1)*(2009 to 2010)
Log wage (t-1)
high schoolbase middle school
junior college or vocational school
university
graduate school
constant
number of obs
number of groups
R2
withinbetweenoverallcoefficient-0.036
0.015
0.047
0.050
0.053
0.056
0.048
0.028
0.017
-0.005-0.017-0.022-0.020-0.019-0.012-0.037-0.031-0.022-0.001
0.021
0.000
0.020
-0.004-0.171-0.053-0.025-0.118
0.393
32661
7019
0.00480.00030.0015

Notes: * <0.1 ; ** <0.5; ***<0.01. Standard errors were corrected for clustering.

43

t value
-0.77
0.37
1.30
1.58
1.93 *
2.39 **
2.40 **
1.82 *
1.53-1.29-1.66 *
-1.88 *
-1.44
-1.18
-0.63
-1.82 *
-1.48
-0.96
-0.18
2.31 **-0.01
1.82 *-0.87-2.13 *
-0.91
-0.38
-1.07
5.85 ***

Appendix

Figure A1
Google Search for “ikuji tanjikan,” Short-Hours Option

44

Table A1
Means of the Data Used for Tables 1 and 2First ChildbirthSecond Childbirth
Third Childbirth
Marrying
marital status dummyage 20-22

23-24
25-26
27-28
29-30
31-32
33-34
35-36
37-38
39-40
40-41
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012

high child intention(t-1)
log hourly wage (t-1)
log f husband's yearly income in 10000 yen (t-1)
weekday husband's domestic work hour in hour (t-1)
weekend husband's domestic work hour in hour(t-1)
firm size 300 & over (t-1)
firm size 300 & over(t-1)*(2005 to 2008)
firm size 100 & over (t-1)
firm size 100 & over(t-1)*(2009 to 2010)
middle school
high school
junior college or vocational school
university
graduate school
sample size

Childless Working Females Working Females with One Child Working Females with Two Child
Mean
Std.Dev Min Max
Mean
Std.Dev Min Max
Mean Std.Dev Min
Max
0.029 0.168
01
0.118 0.323
01
0.025 0.155
01
0.058 0.234
01
0.000 0.000
0
0 0.000 0.016
010.217 0.412
01
1.000 0.000
1
1 1.000 0.000
110.031 0.174
01
0.000 0.017
0
1 0.000 0.012
01
0.082 0.274
01
0.005 0.068
0
1 0.001 0.023
01
0.125 0.331
01
0.018 0.133
0
1 0.005 0.070
01
0.147 0.354
01
0.049 0.217
0
1 0.017 0.128
01
0.153 0.360
01
0.100 0.300
0
1 0.042 0.202
01
0.134 0.341
01
0.136 0.343
0
1 0.089 0.284
01
0.113 0.317
01
0.164 0.370
01 0.142 0.350
01
0.090 0.286
01
0.175 0.380
01 0.197 0.398
01
0.060 0.238
010.140 0.347
01 0.188 0.391
01
0.038 0.191
01
0.107 0.309
01 0.156 0.363
01
0.027 0.161
01
0.107 0.309
01 0.164 0.370
010.159 0.366
01
0.107 0.309
0
1 0.063 0.244
01
0.137 0.344
01
0.089 0.285
0
1 0.071 0.257
01
0.125 0.331
01
0.089 0.285
0
1 0.080 0.271
01
0.116 0.320
01
0.096 0.295
0
1 0.098 0.298
01
0.104 0.305
01
0.099 0.299
01 0.106 0.308
01
0.092 0.290
01
0.102 0.303
01 0.114 0.318
01
0.083 0.276
01
0.103 0.304
01 0.115 0.319
01
0.070 0.256
01
0.106 0.308
01 0.116 0.320
01
0.060 0.238
01
0.106 0.308
01 0.118 0.323
01
0.052 0.223
01
0.101 0.302
01 0.118 0.322
01
0.322 0.467
01
0.237 0.425
0
1 0.034 0.182
017.057 0.643 1.291 12.134
6.874 0.803 2.813 11.472 6.825 0.773 1.897 12.008
5.947 0.488 1.099 8.006 6.021 0.483 0.000 9.105
1.360 1.419
0
24 1.225 1.297
014
4.966 4.413
0
24 4.854 4.366
024
0.337 0.473
01
0.306 0.461
01 0.250 0.433
01
0.161 0.367
01
0.127 0.334
01 0.104 0.306
01
0.528 0.499
01
0.461 0.499
01 0.384 0.486
01
0.080 0.272
01
0.094 0.292
0
1 0.089 0.285
01
0.026 0.158
01
0.027 0.162
0
1 0.019 0.136
01
0.239 0.427
01
0.356 0.479
0
1 0.461 0.499
01
0.466 0.499
01
0.441 0.497
01 0.408 0.492
01
0.252 0.434
01
0.168 0.374
01 0.108 0.311
01
0.017 0.127
010.010 0.101
0
1 0.004 0.059
0
1
32449
3240
7357

45

Firm size over 100

Firm size less than 100

women aged 25-37
without child the year
before

6.9%
5.7%

4.5%
3.8%
3.0%

3.7%
2.4%

2003

4.4%

4.6%

3.0%

3.2%

5.9%
5.3%
4.6%

4.8%
4.4%

5.7%
5.1%

2.9%

2.1%

2004

2005

2006

2007

2008

2009

2010

2011

Figure A2
The Ratio of Women Who Had Their First Childbirth in the Surveyed Year

46

2012

Table A2
Means of Variables Used in Table 3
full-time Permanent work t+1

20-22
23-24
25-26
27-28
29-30
31-32
33-34
35-36
37-38
2004
2005
2006
2007
2008
Policy(2009-2011)
1st childbirth(t)firm size 100 & over (t-1)
1st childbirth(t) * firm size 100 & over (t-1)
1st childbirth(t) * Policy
firm size 100 & over (t-1) * Policy
firm size 100 & over (t-1) * 1st childbirth(t)*Policy
want to equally burden household income with husband
want to equally burden child care with husband
other school
high school
junior college or vocational school
university
graduate school
sample size

47

Mean
Std.Dev
Min
0.426
0.494
0.033
0.180
0.083
0.276
0.123
0.329
0.146
0.353
0.155
0.362
0.136
0.343
0.115
0.319
0.094
0.291
0.060
0.237
0.141
0.348
0.131
0.337
0.121
0.326
0.111
0.314
0.101
0.301
0.231
0.421
0.057
0.231
0.684
0.465
0.013
0.115
0.015
0.122
0.143
0.351
0.005
0.072
0.365
0.481
0.861
0.346
0.012
0.109
0.251
0.433
0.430
0.495
0.271
0.444
0.017
0.131
22458

Max
0
0
0
0
0

1
1
1
1
1

0
0
0
0
0

1
1
1
1
1

0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0

1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1

Table A3
Means of Variables Used in Table 4
Weekly Whour Hour(t+1)
first child birth

20-22
23-24
25-26
27-28
29-30
31-32
33-34
35-36
37-38
2004
2005
2006
2007
2008
Policy(2009-2011)
1st childbirth(t)firmsize 100 & over (t-1)
1st childbirth(t) * firmsize100 & ov(t-1)
1st childbirth(t) * Policy
firmsize100 & ov(t-1) * Policy
firmsize100&ov(t-1) * 1st childbirth(t)*Policy
Log of wage (t-1)
middle school
high school
junior college or vocational school
university
graduate school
sample size

Mean
Std.Dev
MinMax
40.59310.9811120
0.02050.14160
10.02490.156
010.08470.278
01
0.13110.337
010.15080.358
01
0.15500.362
01
0.13240.339
01
0.11390.318
01
0.09010.286
010.06110.239
010.13930.346
010.13520.342
01
0.12000.325
01
0.11440.318
01
0.10520.307
010.23710.425
010.02050.142
010.89460.307
010.01690.129
010.00750.086
010.19780.398
01
0.00670.081
01
7.15480.606
2.996
10.0210.01130.105
010.22520.418
01
0.43930.496
01
0.29260.455
01
0.0190
0.136
0
1
13772

48

Table A4
Means of Variables Used in Table 5
Mean
Std.Dev
Min
Max
High intention for Child
0.319
0.466
0
1
0.031
0.173
0
1
20-22
0.082
0.275
0
1
23-24
0.125
0.331
0
1
25-26
0.147
0.355
0
1
27-28
0.152
0.359
0
1
29-30
0.134
0.341
0
1
31-32
0.113
0.317
0
1
33-34
0.090
0.286
0
1
35-36
0.060
0.237
0
1
37-38
0.136
0.343
0
1
2004
0.131
0.337
0
1
2005
0.115
0.319
0
1
2006
0.103
0.305
0
1
2007
0.092
0.289
0
1
2008
0.083
0.276
0
1
2009
0.070
0.255
0
1
2010
0.060
0.238
0
1
2011
0.052
0.222
0
1
2012
0.337
0.473
0
1
firmsize 300 & over (t-1)
0.162
0.368
0
1
firmsize 300 & over(t-1)*(2005 to 2008)
0.527
0.499
0
1
firmsize 100 & over (t-1)
0.080
0.271
0
1
firmsize 100 & over(t-1)*(2009 to 2010)
7.057
0.644
1.291
12.134
Log wage (t-1)
high school
0.239
0.427
0
1
junior college or vocational school
0.466
0.499
0
1
university
0.252
0.434
0
1
graduate school
0.017
0.128
0
1
32661

49