Culture: An Empirical Investigation of Beliefs, Work, and Fertility

We study the effect of culture on important economic outcomes by using the 1970 census to examine the work and fertility behavior of women born in the U.S. but whose parents were born elsewhere. We use past female labor force participation and total fertility rates from the country of ancestry as our cultural proxies. These variables should capture, in addition to past economic and institutional conditions, the beliefs commonly held about the role of women in society (i.e., culture). Given the different time and place, only the beliefs embodied in the cultural proxies should be potentially relevant. We show that these cultural proxies have positive and significant explanatory power for individual work and fertility outcomes, even after controlling for possible indirect effects of culture. We examine alternative hypotheses for these positive correlations and show that neither unobserved human capital nor networks are likely to be responsible. ∗We thank Oriana Bandiera, Chris Flinn, David Levine, Fabrizio Perri, Jonathan Portes, Frank Vella, and seminar audiences at the SED, NBER, NYU, CERGE at Charles University, University of Cyprus, UC Berkeley, Stanford University, University of Iowa, Essex University, EUI, IGIER, and Pompeu Fabra University. The views expressed herein are those of the authors and not necessarily those of the Federal Reserve Bank of Minneapolis or the Federal Reserve System.