Female labor participation in Iran: a structural model estimation

Abstract

PurposeThe purpose of this study is to determine why female labor force participation in Iran has been less than 20 percent.Design/methodology/approachThe authors estimate a structural dynamic matching model of female participation using individual panel data in Iran. The study incorporates many factors such as wage, child cost, education, spouse employment and job market search parameters.FindingsThe study finds that gender discrimination in job finding has the biggest effect in reducing the rate of women's participation. If all market differences disappear, the female participation rate will increase by 12 percentage points to almost 27 percent, which is still much lower than that of developed countries with the average of 60 percent.Originality/valueThis study provides the first structural search model using a developing country's microdata to study female labor participation.