Three Empirical Essays on Economic Well-being in Canada

Abstract

This thesis studies issues related to population aging. In Canada, various policies address this issue. Such policies include encouraging labour force participation to address challenges about the variations in the size of different birth cohorts through immigration or encouraging fertility while ensuring attachment to the labour market. In this thesis, I explore the influence policies have on the economic well-being of individuals at two significant events in a person’s lifetime, namely childbirth and retirement. In Chapter 1, I examine the impact of children on the earnings of mothers through the lens of Québec’s Parental Insurance Plan. Particularly, I explore how the maternity and parental leave benefits available at first birth affect a woman’s earnings loss. The results show that mothers who received a more generous benefit experience, on average, a larger decline in earnings immediately after the birth of their first child. However, under Québec’s plan, there is a substantial recovery in earnings starting four years after their first child’s birth. In Chapter 2, I study immigrants’ retirement and public pension take-up patterns and examine the residency requirements associated with public pension eligibility and entitlement that primarily impact immigrants. Additionally, I examine how reaching the eligibility age for OAS affects the employment and earnings of Canadian seniors differently depending on their immigration status. The analysis reveals that immigrants who arrive in Canada before age 40, especially those in the economic immigration class, have higher employment rates at older ages compared to native-born Canadians. Conversely, immigrants who arrive later in life and face stricter public pension restrictions tend to have lower employment rates. Furthermore, the impact of the age at immigration appears to outweigh the incentives related to public pension eligibility. In Chapter 3, I document disparities in low-income rates between immigrants and non-immigrants at older ages, focusing on the intersectionality of immigration status, racial identity, and gender while observing the changes over two decades. I find a large decline in low-income rates between 2000 and 2020 and a reduction in the gaps between demographic groups. I show that the differences in low-income levels are associated with variations in prime-age employment, earnings, and access to pension benefits, particularly the Canada Pension Plan.