Explaining The Causal Relationship Between Female Labor Force Participation And Its Determinants In Turkey

Abstract

Despite female labor force participation rate (FLFPR) has steadily increased from 2005 onwards in Turkey, Turkey is still one of the countries having the lowest FLFPRs in the international arena. Furthermore, the labor force participation rate varies substantially by gender in our country. As is known to all, providing high level of economic development in a country can be possible on the condition that high quality of human capital is utilized, gender inequality is eliminated and employment rate is kept up at a high level. Therefore, the objective of this thesis is to present the main barriers preventing women from the labor market in Turkey. This study also aims to draw attention to the reasons behind the labor supply barriers of women from the causal perspective. For this purpose, the impacts of the determinants have been estimated using the data from Household Budget Surveys for the period of 2013-2015 via econometric analyses such as Probit, GSEM, and Mediation. This thesis is unique in terms of employed analyses (GSEM & Mediation) which have not taken place in explaining FLFP either locally or globally. On the one hand, the results of this thesis have been consistent with the findings which were specified both theoretically and empirically in the previous studies. On the other hand, this thesis is differed from the previous ones by testing the hypothesis such that “Turkish women participate in the labor market mostly by considering their opportunity costs for non-market activities.” In conclusion, education has been found the key factor affecting women’s participation since the opportunity costs for non-market activities are mostly determined by the education levels of women. Additionally, marital status, fertility, age, household income, household expenditure, asset ownership, and if married, spouse employment status are the other important factors affecting the women’s participation decisions in Turkey.