2.1 Conceptual Model
The figure of conceptual framework is showed below for the relationship between both independent variables and dependent variable. The reliant variable (dependent) for this experiment is female employment. In the interim, the variable is affected by autonomous factors. In this manner, there are two independent variable that identified with the dependent variable which is the Gross Domestic Product (GDP) per capita and fertility rate.
2.2 Model theories
According to Fox, Klüsener & Myrskylä (2015) stated that from the past theory, the negative relationship between GDP and fertility is decreasing overtime and moving towards positive relationship. In European countries, large number of countries are displaying constant positive relationship between GDP and fertility. GDP and fertility rate has significant positive relationship in the newly industrialized countries. Countries before industrialization had high fertility rate and low GDP, while after industrialization the GDP increased and fertility rate decreased. It had led to increase in aged population in that country (Gori & Sordini, 2017).
The women acquire working skill to secure their jobs which causes them to ignore their childbearing. In Southern European countries, the women acquire working skill to secure their jobs which causes them to ignore their childbearing due to high unemployment rate in their countries. However, certain developed countries like Scandinavia, the government provides maternity benefits to encourage childbearing as an effort to ensure availability of future labour market (Adsera, 2003).
Broeck & Maertens (2015) has stated that female fertility rate among the illiterate and/or poor women in developing rural areas are increasing very quickly compared to the literates and/or non-poor women. This is because the illiterate poor women is very actively participating in the labor force to improve their living quality. Based on Boldrin, Nardi & Jones (2015) claimed that the government increases the old-age-pensions will eventually reduce fertility rate. There are strongly correlated with each other as people will depend on giving birth to themselves so that they can rely on their children when they are old if the government decreases the pensions. According to Rahman (2011) stated that GDP has no significant related with unemployment rate while it exits significant negative relationship between per capita GDP (PGDP) and unemployment rate. In the result, there are significant negative relationship between PGDP and unemployment rate while GDP is not significantly related with unemployment rate and PGDP.
In OECD countries, the cross-country correlation between the female labour force participation rate and the fertility rate had negative relationship before 1980s and changing to a positive relationship thereafter. They suggested that female employment rate increases with the increase in fertility rate (Engelhardt & Prskawetz, 2004). Female labour participation is affected by their living area, as married women living in urban area has lower fertility rate compared to non-working women living in rural area. Besides, the occupational flexibility and working hour also affect the fertility rate of women in urban area (Tsegaye, 2011).
Sobotka, Skirbekk & Philipov (2010) has mentioned that the fertility rate if often cyclical and being affected by the cycle of businesses. He stated that GDP has clear effect of fertility rate,while recession or financial crises shows short term decreases in the fertility rates. This is often related with the career instability and sentiments during financial crises.
Meanwhile, Cazzola, Pasquini & Angeli, (2016) stated that employment rate may have both direct and indirect effect from the fertility rate. Because when the employment rate is declining most of the couples will postpone their idea of getting a child to secure their financial well-being and prepare themselves to cooperate with the reduced family income.