This paper is an attempt to investigate how children affect married women's decision to participate in the Taiwanese labor market. The effect of children on the female labor supply is usually negative for most married women; however, it might also be positive for some subpopulations. Thus, herein, we use a local likelihood logit regression to detect the heterogeneity in the effects of children on married female employment that cannot be detected by parametric (e.g. probit or logit models) or semiparametric estimation. Our empirical findings provide evidence of some heterogeneity in the response related to children on the participation of Taiwanese married women in the work force. Since, we find evidence of heterogeneous effects, we suggest that different government policy instruments should be precisely targeted at different specific subpopulations in order to effectively increase the participation of married women in the labor force. When comparing these average characteristics of married women with positive versus negative employment effects due to having children, we find that the average married woman's educational attainment and the logarithm of the husband's wage income differ significantly between women with positive effects of children and those with negative effects of children.
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