Date of Award

8-21-2007

Degree Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Department

Economics

First Advisor

Dr. Paul G. Farnham - Chair

Second Advisor

Dr. Mary Beth Walker

Third Advisor

Dr. Inas Rashad

Fourth Advisor

Dr. Erdal Tekin

Fifth Advisor

Dr. Gregory B. Lewis

Abstract

Over the past 50 years, women have become important participants in the labor market. With the increase in the number of middle-aged women going through the menopause transition, the question arises as to the effect of this transition on the labor market. Previous studies have shown that reproductive cycles have a non-trivial negative effect on women’s labor market outcomes. Thus, the cessation of these reproductive cycles (menopause) should bring relief for these women. However, another body of literature asserts that the menopause transition itself has a negative effect on women’s mental and physical health and so may have a negative effect on labor market outcomes. This study seeks to explore the effect of the menopause transition on labor market outcomes. The empirical analyses are done using data from the National Longitudinal Survey of Young Women, with the key explanatory variables being the menopause transition stages: premenopause, perimenopause, surgical menopause and natural postmenopause. The regressions include a control for whether the woman experienced early menopause and whether she had a hysterectomy. The first part of the study examines the impact of the menopause transition on health using depression and the scores on the activities of daily living as the measures of health status. These analyses use cross sectional data drawn from the 1995 wave of the survey for activity limitations and the 2003 wave for the depression measure. The findings of these analyses indicate that the menopause transition increases the likelihood of depression and functional limitations. The main part of the study explores the effect of the menopause transition on the following labor market outcomes: labor force participation, hours worked, full time employment, wages, and self-employment. Ordinary Least Squares, the fixed effects model, the random effects model, and the family fixed effects (siblings) model are used to examine these questions. The analysis also uses 2SLS to correct for endogeneity of the menopause variables and the Heckman two-step procedure to correct for sample selection bias. The findings show that women in premenopause are less likely to be in the labor force than women in natural postmenopause, even after controlling for life-cycle variables. The results also indicate that there are certain benefits from using hormone replacement therapy (HRT), as women who had surgical menopause and are using hormones are more likely to be in the labor force than women with surgical menopause who are not using HRT. Women in premenopause and women in perimenopause are less likely to work full-time compared to women who experienced natural postmenopause. The findings also show that there are no significant differences in hours worked by women in the different menopause stages. Women in premenopause typically earn more than women in natural postmenopause. Furthermore, women in perimenopause and women with surgical menopause are more likely to be self employed. The findings indicate that, among a generally healthy population, the menopause transition results in an increase in labor supply. However, a wage penalty is observed among women in postmenopause, when compared to women who are premenopause. The implications of the findings are that menopause should not be medicalized but should be viewed in a social and cultural context as the changes that occur during the transition may open up possibilities for positive individual development. Thus the cessation of menstrual cycles brings relief for women and results in an increase in labor supply, albeit one associated with a wage penalty.

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Economics Commons

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