Figure 3: Labour supply by gender
Males -- -- Females
male labour supply. Although female hours then tend to rise in the following working-
age phases, they do not reach much above 50 per cent of male hours, even after the
children have left home in phase 5.
Time use data show that the sharp fall in female hours in phase 2 is associated with an
even more dramatic rise in hours of domestic work, much of which is childcare.24
This suggests that, due to the demand for childcare, domestic work is a close
substitute for market work in this phase. The data offer an explanation for why the
labour supply elasticity of the female partner, typically on a lower wage, is found to
be greater than that of the male partner, especially in a country with a poorly
developed childcare sector. When market and home childcare are close substitutes,
and childcare is costly, tax rates on the income of married mothers at the levels
indicated in the preceding section can be expected to induce labour supply responses
that generate low female hours as depicted in Figure 3.
The average profile for female labour supply in Figure 3 conceals the high degree of
heterogeneity observed in female hours. The majority of married women work either
24 See Apps and Rees (2005). Time use data for a number of countries, including the UK, US and
Germany, as well as the 1997 ABS Time Use Survey data, show this.
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