Employment and Fertility - East Germany in the 1990s Michaela Kreyenfeld Universität Rostock Wirtschafts- und Sozialwissenschaftliche Fakultät Employment and Fertility - East Germany in the 1990s Inauguraldissertation zur Erlangung des akademischen Grades eines Doktors der Wirtschafts- und Sozialwissenschaften (Dr. rer. pol.) an der Wirtschafts- und Sozialwissenschaftlichen Fakultät der Universität Rostock vorgelegt von Diplom-Sozialwissenschaftlerin Michaela Kreyenfeld November 2001 Acknowledgments I am very much indepted to the Max-Planck Institute for Demographic Research in Rostock for a doctoral fellowship which enabled me to conduct this study. In particular, I would like to thank Hans-Peter Kohler for letting me carry out this study in his research group “Social Dynamics and Fertility”. List of Content Part I Theoretical Considerations Chapter 1 Introduction ....................................................................................................3 Chapter 2 Labor Markets and Family Policies in the GDR and FRG .........................13 2.1 Institutional Constraints in East Germany before Unification .........................14 2.1.1 Labor Market Institutions.........................................................................14 2.1.2 Transfers & In-Kind Benefits...................................................................16 2.1.3 Compatibility of Childrearing and Employment......................................19 2.2 Institutional Constraints after Unification........................................................25 2.2.1 The East German Labor Market Crisis ....................................................26 2.2.2 Compatibility of Childrearing and Employment......................................39 2.2.3 Taxes & Transfers....................................................................................46 2.3 Conclusion........................................................................................................51 Chapter 3 Employment and Fertility Decisions...........................................................53 3.1 The Standard Economic View on Fertility.......................................................53 3.2 Family Policies and Fertility Decisions............................................................57 3.3 Fertility Decisions from the Life Course Perspective.......................................62 3.3.1 Timing of First Birth................................................................................64 3.3.2 Women’s Education and the Second Child .............................................72 3.4 Intermediate Summary: An Alternative View on Employment and Fertility .............................................................................................................74 3.5 Employment and Fertility after Unification .....................................................76 3.6 Conclusion........................................................................................................81 I Part II Empirical Investigations Chapter 4 Fertility Patterns before and after Unification ...........................................87 4.1 Fertility Patterns before German Unification ................................................... 88 4.2 The Fertility Decline after German Unification ............................................. 100 4.3 The Cohort Perspective .................................................................................. 104 4.3.1 The Unification Cohorts ........................................................................ 105 4.3.2 The Post-Unification Cohorts ................................................................ 108 4.4 Conclusion...................................................................................................... 110 Chapter 5 Fertility after Unification: A Parity Specific View ....................................113 5.1 Desires for Children in 1992 .......................................................................... 114 5.2 The First Child ............................................................................................... 118 5.2.1 Transition to the First Child before and after Unification ..................... 118 5.2.2 A Closer Examination of the “Period Effect”........................................ 128 5.3 Higher Parity Births........................................................................................ 134 5.3.1 The Second Child................................................................................... 134 5.3.2 The Third Child ................................................................................... 1349 5.4 Conclusion...................................................................................................... 141 Chapter 6 Employment and the Transition to the First Child after Unification......143 6.1 Previous Empirical Findings .......................................................................... 144 6.2 Procedure of the Analysis............................................................................... 147 6.3 Woman’s Education and First Birth............................................................... 156 6.3.1 Education and First Birth before Unification (Digression).................... 157 6.3.2 Education and First Birth after Unification ........................................... 159 6.4 The Role of Women’s (Un)employment........................................................ 166 6.5 The Role of the Partner’s Employment Status ............................................... 172 6.6 Conclusion...................................................................................................... 177 II Chapter 7 Employment and the Transition to the Second Child after Unification.181 7.1 Procedure of the Analysis...............................................................................182 7.2 Women’s Education and Second Birth...........................................................188 7.3 The Role of the Partner’s Employment Status ...............................................190 7.4 The Joint Effect of the Woman and her Partner’s Education.........................194 7.5 Conclusion......................................................................................................198 Chapter 8 Concluding Remarks .................................................................................201 Appendix.....................................................................................................210 A.1 The German Socio-Economic Panel (SOEP).................................................212 A.1.1 Description of the SOEP........................................................................212 A.1.2 Selection of the Sample .........................................................................215 A.1.3 Description of the Variables ..................................................................215 A.2 The German Micro-Census (Mikrozensus)....................................................220 A.2.1 Description of the Mikrozensus.............................................................220 A.2.2 Selection of the Sample ........................................................................221 A.2.3 Description of the Variables .................................................................221 A.3 The Family and Fertility Survey (FFS)...........................................................223 A.4 Estimating Parity Specific Birth Rates for West Germany ............................224 A.3.1 Lack of Birth Parity Information for Germany ......................................225 A.3.2 Estimation Procedure.............................................................................226 A.3.3 Comparison with other Estimations.......................................................229 References..................................................................................................235 III IV List of Tables Table 1: Family Policies in the GDR ...................................................................................... 18 Table 2: Women’s Employment Rate in 1997 by Age of Youngest Child............................. 37 Table 3: Provision of Public Daycare 1990, 1994, 1998 ........................................................ 44 Table 4: Family Policies in the FRG....................................................................................... 48 Table 5: Family Policy Classification Scheme ....................................................................... 58 Table 6: Mean Age at First Birth in Selected European Countries, 1960-1995 ..................... 64 Table 7: Expected Impact of Women and Men’s Employment on Fertility ........................... 83 Table 8: Age at First Birth by Calendar Year (1952-1990) and Birth Cohort (1935-1958) ... 91 Table 9: Percent of Childless Women, Cohorts 1935-1960.................................................... 93 Table 10: Total Fertility Rate (TFR), Completed Family Size, Parity Progression Ratio (PPR), Cohorts 1940-1955 .............................................................................. 97 Table 11: Number of Children in 1990, Cohorts 1961-1970 .................................................. 107 Table 12: Desire to Have Children in 1992 ............................................................................ 115 Table 13: Desired Age at First Birth in 1992.......................................................................... 116 Table 14: Desired Number of Children in 1992.....................................................................