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The link between economic growth and labor market participation is complex and elusive. Investments in female education are expected to increase women's productivity at home, but the relationship to labor force participation is less clear. Research has identified a U-shaped relationship where women leave the labor market at early stages of economic development and return when a white-collar sector develops (Sinha, 1967; Durand, 1975; Pampel Goldin, 1995; Horton, 1996; Mammen Juhn & Ureta, 2003). This study replicates previous models using time-series analysis and consideration of large increases in female schooling over the past 30 years. The results suggest that investments in female education can overcome potential reductions in female participation due to increases in wealth, and policies to invest in girls' education appear to have benefits for labor markets, as well as family production.
Jane Arnold Lincove (Sun,) studied this question.