The Effect of Religious Constraints on Individual Labor Supply

We study the effect of religious constraints on individual’s labor supply decisions in the context of Ramadan, one of the central pillars of Islam, consisting of an entire lunar month of fasting from sunrise to sunset. Using household panel data from Malawi for the years 2010, 2013, and 2016, we find that females reallocate their time, from their jobs to household work. For males, we do not find such reallocation of hours, as they increase both, their hours worked at their jobs but also in the household. As a robustness check to our results, we use household data from Bangladesh to support the estimates on the extensive margins, where we do not find any effect on labor force both for females and males or the likelihood of working during Ramadan. These findings show that we need to go beyond general beliefs that labor supply goes down, but individuals keep working at home or more hours overall, when religious constrains appear.