Article

The Impact of Children on Wages, Job Tenure, and the Division of Household Labour

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Abstract

In the absence of typical exclusion restrictions, covariance restrictions are used to obtain estimates of the effects of children on household behaviour. Using data from the PSID on two age samples, children are found to have a significant impact on many household decisions. However, while in the young sample exogenous fertility cannot be rejected, in the older sample this is not the case. Finally, if the average household had one less child, the male-female wage differential would decrease by 9.5 %.

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... In addition to marriage, motherhood has similar effects on women's family responsibility. Studies that include child care as a category in family work show that childrearing increases women's overall household work much more than men's (Brink & Groot, 1997;England, 2005), and some studies even conclude that children have no effect on a male's home time at all (Lippe, 1992;Millimet, 2000). However, scholars argue that although children have increased the value and importance of household work (including both family and childrearing responsibilities), it just influences the trade off between household and other market and non-market work. ...
... However, scholars argue that although children have increased the value and importance of household work (including both family and childrearing responsibilities), it just influences the trade off between household and other market and non-market work. The mother's reservation wage and the marginal value of market and non-market work, on the other hand, have not been influenced (Brink & Groot, 1997;Millimet, 2000). In contrast, others predict a negative effect of children on female wages (G. S. Becker, 1985;Budig & England, 2001;Lundberg & Rose, 2000;Waldfogel, 1997a), though the penalty of children on the mother's wage varies among studies since they apply different models and equations. ...
... The portion of income in excess of 100,000 Yuan Source: (Zuo, 2003) The discussion on the exclusion of child care duties in household time allocation will undoubtedly lead to an understatement of the wife's share of work. Studies that include child care as a category in family work show that childrearing increases women's overall household work much more than men's (Brink & Groot, 1997;England, 2005), and some studies even conclude that children have no effect on male's home time at all (Lippe, 1992;Millimet, 2000). In accordance with Brink & Groot (1997), mothers in double income families, on average, have the heaviest work load and the least amount of leisure time in comparison to fathers, unemployed mothers, and women without children, because the increased childrearing time by mothers with young children is not solely at the cost of labour supply, but also in leisure time (Kaufman & Hotchkiss, 2003;Lippe, 1992;Millimet, 2000). ...
... For example, Lundberg (1988) finds that labour supply of husbands and wives is jointly determined only when young children are present. Hersch and Stratton (1994) analyse the division of housework for employed spouses, finding significant interactions between the time allocation of husbands and wives, their education and the presence of children under age 12. Angrist and Evans (1998), Millimet (2000), Ebenstein (2009) and others document a significant, negative effect of children on the labour supply of married women, but no corresponding effect on the time allocation of men. Millimet (2000) also finds a positive impact of children on the wages of men, while Waldfogel (1998), Hersch and Stratton (1997) and others discuss the 'motherhood wage penalty'. ...
... Hersch and Stratton (1994) analyse the division of housework for employed spouses, finding significant interactions between the time allocation of husbands and wives, their education and the presence of children under age 12. Angrist and Evans (1998), Millimet (2000), Ebenstein (2009) and others document a significant, negative effect of children on the labour supply of married women, but no corresponding effect on the time allocation of men. Millimet (2000) also finds a positive impact of children on the wages of men, while Waldfogel (1998), Hersch and Stratton (1997) and others discuss the 'motherhood wage penalty'. Finally, a number of studies provide empirical evidence in support of the marriage premium: the fact that married men earn more on average than single men even after controlling for common measures of human capital (e.g. ...
... The negative relationship between children and female worklife expectancy is consonant with the vast empirical studies documenting the deleterious (causal) effects of children on female labour force participation (e.g. Angrist and Evans, 1998;Millimet, 2000). Of course, studies of the effects of children on female labour force participation typically focus on just the impact of young children on labour market behaviour (while the children still reside at home). ...
Article
Measuring an individual's human capital at a point in time as the present actuarial value of expected net lifetime earnings has a lengthy history. Calculating such measures requires accurate estimates of worklife expectancy. Here, worklife estimates for men and women in the USA categorized by educational attainment, race, marital status, parental status and current labour force status are presented. Race has a much larger impact on the worklife expectancy of men than women. Education is associated with larger worklife differentials for women. The association between marriage and worklife expectancy is significant, but of opposite sign, for men and women: married women (men) have a lower (higher) worklife expectancy than single women (men). Parenthood is associated with a reduction in the worklife expectancy of women; the association is smaller and varies from positive for some education/marital status groups to negative for others for men. Copyright © 2010 Blackwell Publishing Ltd.
... Budig & England ( 2001 ) , Phipps et al . ( 2001 ) , and Waldfogel ( 1998a ) and consistent with the results found in Millimet ( 2000 ) for the US . The negative impact may to a large degree reflect that mothers make different choices than non - mothers in terms of non - participation , part time , choice of occupation etc . ...
... 0% in average wages for the population of fathers , see Table 3 above . The fact that fathers seem to gain from fatherhood is consistent with the literature , yet the effect is comparatively small : Millimet ( 2000 ) finds that fathers gain as much as 12% from fatherhood . As is the case with mothers , the wage effect may be due to fathers ' different labour - market choices . ...
Article
In this chapter, we characterise the selection into parenthood for men and women separately and estimate the effects of motherhood and fatherhood on wages. We apply propensity score matching exploiting an extensive high-quality register-based data set augmented with family background information. We estimate the net effects of parenthood and find that mothers receive 7.4% lower average wages compared to non-mothers, whereas fathers gain 6.0% in terms of average wages from fatherhood.
... The results for women are in stark contrast to those of men. Though much less frequently investigated, existing studies suggest that fathers are likely to observe an increase in wages from parenthood and marriage more generally; see Browning (1992), Pencavel (1986), Millimet (2000), and Simonsen and Skipper (2008). This is particularly intriguing given that fathers are also affected by (at least some of the) negative productivity shocks caused by the arrival of a child mentioned above. ...
... g . Datta Gupta and Smith ( 2002 ) , Simonsen and Skipper ( 2006 , 2008 ) ) and also consistent with results from the more recent studies from the US , see for example Millimet ( 2000 ) . As indicated above , the few existing papers find that men gain from parenthood and marriage more generally . ...
Article
We shed new light on the effects of having children on hourly wages by exploiting access to data on the entire population of employed same-sex twins in Denmark. Our second contribution is the use of administrative data on absenteeism; the amount of hours off due to holidays and sickness. Our results suggest that childbearing reduces female hourly wages but the principal explanation is in fact mothers' higher levels of absence. We find a positive wage premium for fathers.
... Recently the literature has also focussed on male labour supply, but the few studies examining the impact of fertility on male as well as female labour supply are limited to developed countries (Angrist and Evans 1998, Millimet 2000, Lundberg and Rose 2000. ...
... Using the sex composition of the first two children as instrumental variables for fertility, Angrist and Evans (1998) found that in the U.S. fertility reduces female labour supply significantly but that there is no significant change in male labour supply. On the other hand, in their individual fixed-effect estimation, Lundberg and Rose (2002) found that the presence of children significantly increases male labour supply in the U.S. 1 By estimating the 1 The fixed-effect estimation leaves a potential endogeneity issue that the expectation on the events like a promotion 2 allocation of time, the value of non-market time, job tenure, market wages, and fertility for married couple in the PSID sample, Millimet (2000) found that fertility reduces male and female labour supply and that it does not have a significant impact on male and female wages. ...
Article
Full-text available
While a large body of literature focuses on how fertility affects female labour market participation, there are relatively few studies that examine the effect of fertility on male labour market participation. Even if the burden of child care falls mainly on women, an exogenous increase in fertility is likely to change the optimal allocation of time, therefore, the labour supply decision of both female and male in a household. This paper analyses how an exogenous increase in fertility affects labour market participation of men and women in Indonesia - a country that has seen dramatic changes in the labour market over recent decades. The finding is that women reduce their working hours in response to the higher fecundity in both rural and urban areas in Indonesia. On the other hand, the higher fecundity leads to men’s increasing their working hours only in rural areas. The higher degree of specialization in response to fertility in rural areas is driven mainly by the differences in the cost of childcare rather than the characteristics of occupation or household bargaining power.
... Previous research shows that the birth of the first child typically leads to gendered responses in families, with the woman's behavior changing more than the man's (Barnes, 2015;Baxter, Hewitt, & Haynes, 2008;Maume, 2006;Sanchez & Thomson, 1997). Parenthood often contributes to substantial decreases in women's earnings and employment (Cools & Strøm, 2016;Gibb, Fergusson, John Horwood, & Boden, 2014;Knoester & Eggebeen, 2006;Loughran & Zissimopoulos, 2009;Lundborg, Plug, & Rasmussen, 2017;Millimet, 2000;Sigle-Rushton & Waldfogel, 2007). The effects of parenthood among men tend to be smaller, and when present, to run in the opposite direction (ibid.). ...
Article
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Young adulthood is a dynamic and demographically dense stage in the life course. This poses a challenge for research on the socioeconomic consequences of parenthood timing, which most often focuses on women. We chart the dynamics of delayed parenthood and its implications for educational and labor market trajectories for young adult women and men using a novel longitudinal analysis approach, the parametric g-formula. This method allows the estimation of both population-averaged effects (among all women and men) and average treatment effects (among mothers and fathers). Based on high-quality data from Finnish registers, we find that later parenthood exacerbates the educational advantage of women in comparison to men and attenuates the income advantage of men in comparison to women across young adult ages. Gender differences in the consequences of delayed parenthood on labor market trajectories are largely not explained by changes in educational trajectories. Moreover, at the time of entering parenthood, delayed parenthood improves the incomes of fathers more than those of mothers, thereby exacerbating existing gender differences. The results provide population-level evidence on how the delay of parenthood has contributed to the strengthening of women’s educational position relative to that of men. Further, the findings on greater increases in fathers’ than mothers’ incomes at the time of entering parenthood, as followed by postponement, may help explain why progress in achieving gender equality in the division of paid and unpaid work in families has been slow.
... This theory basically based on Three-Sector Analysis 23 which stated that, as income rises, the economy moves from primary sector (agriculture-based) to the secondary (industrial-based), and the pollution level will increase. Afterward, when a country becomes more prosperous, the economy moves to the tertiary sector (services-based), environmental pollution should be decreased (Millimet, 2000;Linden and Mahmood, 2007;Dinda, 2004;Alam, 2015). Eurostat (2014) reported that this situation happens as the level of awareness regarding the effect of environmental pollution increase. ...
Conference Paper
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This paper examines the impact of structural transformation on environmental pollution in selected Asian countries for the years 1990-2015. This transformation decomposes into technological progress, structural changes, demographic changes and trade openness. We analyse the extended stochastic impacts by employing the regression on population, affluence, and technology (STIRPAT) model. Findings suggest that the industrialization process will induce increased environmental pollution, while the teritarization process lowers environmental pollution. Further, the results support the existence of an inverted-U curve between affluence level and CO emissions and urbanization and CO emissions, implying that at a higher scale of the economy, environmental pollution decreases. Nevertheless, as the scale of the economy becomes large, environmental pollution cannot be counter balanced by the positive impact of tertiarization effect. In addition, we found an interesting result by accounting for a range of demographic dynamics; the results show that an increase in aging population contributes to carbon emission increment. This study not only sheds light on existing literature, but it also provides policy makers with insightful information on how to promote growth and sustainability development policies .
... Finally, changes in actions and conducts may be associated with occupational structures and characteristics. It is shown that fathers tend to have longer job tenure, and seniority may be one reason for the fatherhood premium (Millimet 2000). The longer one works for a firm, the more experience and insight knowledge one accumulates, and more importantly, the more benefits one reaps and garners. ...
... The "motherhood wage penalty", which is usually explained e.g. by lower work experience of mothers, employment in lower-wage jobs with more "family-friendly" environment, employers' discrimination or other factors, reaches the value ranging from -2 % to -5 % for one child, and from -4 % to -13 % for two or more children according to the elapsed time from a childbirth and mother's educational attainment (Leung, 2007;Waldfogel, 1997). It is noteworthy that statistically significant differences in impact of children on wages have been identified between genders in favour of men (Millimet, 2000; see also Hersch, Stratton, 2000;Levine, Gustafson, Velenchik, 1995). ...
Article
Full-text available
The list of variables included in wage models has been extended substantially since 1974 when Mincer published his model containing years of schooling and quadratic function of potential experience. This paper provides an overview of the variables most often employed in wage equations, including results from their estimations. Education, experience, particular skills, psychological traits, beauty and health, social capital, characteristics potentially connected with discrimination, individuals household characteristics and social, cultural and economic background the individual was exposed to during childhood and adolescence, all these are aggregated fields of interest which are discussed in detail. The paper is concluded by the outline of the probable development of research on wage determinants.
... The majority of these studies focus on female labor supply and they find a negative correlation between the number of children and female labor-force participation. However, more recent studies have also focused on male labor supply, but the few studies examining the impact of fertility on male as well as female labour supply are limited to developed countries (Lundberg and Rose, 2002; Millimet, 2000). Browning (1992) argues in his literature review on this topic that despite a wide number of published papers find a significant and negative relationship between these variables, they do not assess a causal effect due to the endogeneity problems. ...
Article
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This paper examines the effect of fertility on parental labor-force participation in a developing country in the Balkans, with particular attention to the intervening role of childcare provided by grandparents in extended families. In order to address the potential endogeneity in the fertility decision, I exploit Albanian parental preference for having sons combined with the siblings sex-composition instrument as an exogenous source of variation. Using a repeated cross-section of parents with at least two children, I find a positive and statistically significant effect of fertility on parental labor supply for those parents who are more likely to be younger, less educated or live in extended families. In particular, IV estimates for mothers show that they increase labor supply, especially in terms of hours worked per week and the likelihood of working off-farm. Similarly, father's likelihood of working off-farm and having a second occupation increase as a consequence of further childbearing. The heterogeneity analysis suggests that this positive effect might be the result of two plausible mechanisms: childcare provided by non-parental adults in extended families and greater financial costs of maintaining more children.
... Waldfogel (1998aWaldfogel ( ,1998b identifies as the main reason for large wage losses the long employment breaks after childbirth associated with employer changes. For the UK, Millimet (2000) estimates a causal effect with a simultaneous model using a covariance restriction as identifying strategy. Ejrnaes and Kunze (2013) and Schönberg and Ludsteck (2012) use German policy reforms to investigate the causal effect of births on female wages in Germany. ...
Thesis
Overview This dissertation analyzes the development of wage inequality in Germany and different economic factors that may have contributed to the recent increase in wage dispersion. Surprisingly, the drop in collective bargaining coverage, which affects all groups of workers, hardly contributes to the growth in wage inequality. The rising incidence of performance pay does explain a level increase in wages, but not the growth in wage dispersion. Abstract The growth in wage inequality is hotly discussed in academic research as well as in the public debate. In order to contribute to this discussion, this dissertation analyses empirically large employer-employee data for Germany based on state-of-the-art econometric methods. It shows that, at the beginning of the 21st century, real wages are increasing at the top of the wage distribution, while at the same time wages at the bottom of the wage distribution decrease, adding to a drifting apart of the wage distribution. The dramatic decline in collective wage bargaining coverage between 2001 and 2006, however, cannot explain the growth in wage inequality, as shown by the sequential decomposition method based on quantile regressions. As part of the dissertation, existing decomposition methods are developed further. As collective wage bargaining cannot explain the growth in wage inequality, can the growing use of performance pay schemes add part of the explanation? This dissertation shows for the first time, that in Germany this seems not to be the case, as opposed to the case in the US. Notwithstanding, the growing use of performance pay does add to a higher wage level– just not to growing dispersion. Finally, the last part of the dissertation thesis investigates the employment behavior of mothers after the birth of their first child, as this could have a large effect on wage differences between mothers and non-mothers or men. The causal analysis uses a dynamic treatment model combined with an inverse probability matching estimator. It finds strong negative effects of first birth on labor force participation, in particular for middle skilled women. This negative employment effect declines over the observation period (1991-2008). Structure The dissertation consists of four chapters, each of which represents a self-contained research article. Each of the articles applies state-of-the-art econometric methods to large German data sets. While some of the chapters contribute to developing the econometric methods further, the focus is always on the application to the empirical question.
... Deras löner ökar med omkring fyra procent som en direkt följd av föräldraskapet. Att föräldraskap kan ha en positiv effekt på mäns löner har också hittats i andra studier (se till exempelBrowning (1992),Millimet (2000) och Simonsen och Skipper(2008)). Författarna frågar sig dock hur detta kan förklaras. ...
... Deras löner ökar med omkring fyra procent som en direkt följd av föräldraskapet. Att föräldraskap kan ha en positiv effekt på mäns löner har också hittats i andra studier (se till exempelBrowning (1992),Millimet (2000) och Simonsen och Skipper(2008)). Författarna frågar sig dock hur detta kan förklaras. ...
... The "motherhood wage penalty", which is usually explained e.g. by lower work experience of mothers, employment in lower-wage jobs with more "family-friendly" environment, employers' discrimination or other factors, reaches the value ranging from -2 % to -5 % for one child, and from -4 % to -13 % for two or more children according to the elapsed time from a childbirth and mother's educational attainment (Leung, 2007;Waldfogel, 1997). It is noteworthy that statistically significant differences in impact of children on wages have been identified between genders in favour of men (Millimet, 2000; see also Hersch, Stratton, 2000;Levine, Gustafson, Velenchik, 1995). ...
Article
Full-text available
The list of variables included in wage models has been extended substantially since 1974 when Mincer published his model containing years of schooling and quadratic function of potential experience. This paper provides an overview of the variables most often employed in wage equations, including results from their estimations. Education, experience, particular skills, psychological traits, beauty and health, social capital, characteristics potentially connected with discrimination, individual’s household characteristics and social, cultural and economic background the individual was ex-posed to during childhood and adolescence, all these are aggregated fields of interest which are discussed in detail. The paper is concluded by the outline of the probable development of research on wage determinants.
... In a study of the gender gap in twenty two countries, Blau andKahn (2003)use the same dataset as ours and find that labor market institutions that compress the wage structure overall also tend to reduce the wage gap between men and women. Other studies have concluded that a reduction of the family gap would cause the gender gap to fall as well (Waldfogel 1998, Waldfogel 1998b, Millimet 2000) since a large percentage of women are also mothers (60% in our sample). We argue that labor market institutions can have very different effects on the earnings differential between men and women on the one hand and women with children and non-mothers on the other. ...
Article
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Using the microdata for 35 countries over the period 1985 to 1994 and 1994 to 2002 we find that labour market institutions are traditionally associated with more compressed wage structures and a higher family gap. Our results indicate that these policies reduce the price effect of having children but aggravate the human capital loss due to motherhood. We also find evidence that policies that help women to continue in the same job after childbirth decrease the family gap. Of all the countries we study, mothers in Southern Europe suffer the biggest family gap and our analysis indicates that this is due to the bad combination of labour market policies in these countries. Our results are robust to specification changes and indicate that the main reason for mothers to lag behind other women in terms of earnings is the loss of accumulated job market experience caused by career breaks around childbirth.
... The results for women are in stark contrast to those of men. Though not as frequently investigated, existing studies suggest that fathers are likely to observe an increase in wages from parenthood and marriage more generally; see Browning (1992), Pencavel (1986), Millimet (2000), and Simonsen and Skipper (2008). This is particularly intriguing given that fathers are probably also affected by negative productivity shocks caused by the arrival of a child. ...
Article
We shed new light on the effects of having children on hourly wages by exploiting access to data on the entire population of employed twins in Denmark. In addition we use administrative data on absenteeism; the amount of hours off due to holidays and sickness. Our results suggest that childbearing reduces female hourly wages but the principal explanation is in fact mothers’ higher levels of absence. We find a positive wage premium for fathers both when applying OLS on the entire population of Danes and when imposing twin fixed effects in the twin sample.
... 5 Some papers have also attempted to control for the endogeneity of fertility in estimating the impact of children on female labour supply and the wages of mothers: see Angrist and Evans (1998), Gangadharan and Rosenbloom (1996), Iacovou (2001) and Millimet (2000). ...
Article
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This report presents the findings of research into how and when differences in work behaviour between men and women develop, focusing on the evolution of the gender gaps immediately after childbirth and during the initial years of family development. The analysis presented focuses on two crucial periods in family development: when a new baby arrives and when a child starts school. The study uses two data sources: the first thirteen waves from the British Household Panel Survey covering the years 1991 to 2003 and the first five waves from the Families and Children Study covering the years 1999 to 2003.
... 5 Some papers have also attempted to control for the endogeneity of fertility in estimating the impact of children on female labour supply and the wages of mothers: see Angrist and Evans (1998), Gangadharan and Rosenbloom (1996), Iacovou (2001) and Millimet (2000). ...
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Since October 2003 the Department for Work and Pensions (DWP) has been piloting reforms in England, Scotland and Wales which provide greater support alongside greater obligations to encourage many new claimants of incapacity benefits to move into paid work. The Pathways to Work package of reforms includes: a series of usually mandatory workfocused interviews; programmes designed to boost claimants' prospects of being able to work; and increased financial incentives for individuals to enter paid employment. As part of a quantitative assessment of the impact of the programme, a telephone survey of those making an initial enquiry to Jobcentre Plus about claiming incapacity benefits was conducted in both pilot and comparison areas before and after the pilots were implemented. This report focuses on the differences in some early quantitative outcomes between Pathways and non-Pathways areas. Two empirical techniques are used to investigate the early impact of the pilots on employment, earnings, receipt of incapacity benefits, and a potential indicator of the extent to which individuals' health affects their everyday activities. The analysis was undertaken by researchers at the Institute for Fiscal Studies and the telephone interviews were undertaken by the National Centre for Social Research. All these findings are preliminary: more comprehensive analysis will be conducted in later stages of the evaluation. This report analyses outcomes at a time shortly after the pilots started. Further analysis of outcomes will assess Pathways to Work using survey and administrative data from a later cohort and will examine outcomes over a longer period of time.
... In an empirical study byMillimet (2000), children are found to reduce women's productivity and labor supply, and there is a significant feedback effect from labor to fertility decisions. ...
Article
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We develop a tractable framework with a fully specified dynamic process of demographic and labor decisions over an individual female's life span to determine the timing of childbearing. Fertility affects women's behavior through three channels: its tradeoff with leisure, its interactions with human capital investment, and its cost in terms of lost market productivity. Instead of numerically solving a discrete-time version of the model, we propose an alternative solution technique that provides analytic, closed-form solutions for the continuous-time dynamic optimization problem with (discrete) time-line variables. The analytic results indicate that (i) increased impatience has an ambiguous effect on childbearing timing; (ii) the age at first birth rises at an increasing rate with the productivity loss from children; and (iii) women of greater ability have births at later ages and are more sensitive to parameter changes. Calibration exercises suggest that focusing on the median female's response to changes in the preference, cost, and technology parameters fails to capture their important distributional effects.
... Many applications of covariance restrictions make use of twins or impose a recursive structure arising out of the assumed sequential nature of the decision process, in which, for example, the schooling decision precedes the occupational decision which in turn precedes wage realizations. More recent applications make comparisons of children within the household along with their mother, as in Wolpin (1994, 1995), or comparisons of husbands and wives, as in Millimet (2000) . In our application we do not assume a recursive decisionmaking process or make use of the peculiar restrictions that arise from comparing sets of twin. ...
Article
The impact of participation in group-based credit programs, by gender of participant, on the health status of children by gender in rural Bangladesh is investigated. These credit programs are well suited to studies of how gender-specific resources alter intra-household allocations because they induce differential participation by gender. Women's credit is found to have a large and statistically significant impact on two of three measures of the healthiness of both boy and girl children. Credit provided to men has no statistically significant impact and the null hypothesis of equal credit effects by gender of participant is rejected. Copyright 2003 By The Economics Department Of The University Of Pennsylvania And Osaka University Institute Of Social And Economic Research Association
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We study the earnings and career profiles of employees who experience the birth of the first child, as compared to their childless co-workers. Using a difference-in-differences approach and a unique 12-year panel of personnel records from a large French company, we find that the arrival of a child creates a persistent penalty in earnings for mothers. The gap in internal promotions, both at the extensive and intensive margin, accounts for the vast majority of the motherhood penalty within the firm. We believe that firm-level policies on child-related leaves, if not gender neutral, can exacerbate the motherhood penalty.
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Navigating the labor market in today’s economy has become increasingly difficult for those without a college degree. In this study, we ask whether and how working-class men and women in the United States are able to secure gains in wages and/or earnings as they transition to parenthood or increase family size. We look closely at child parity, employment behavior (e.g., switching employers, taking on multiple jobs, increasing hours), and occupation in the year after the birth of a child. Using the 2004 and 2008 panels of the Survey for Income and Program Participation (SIPP), we employ fixed-effects models to examine the impact of changing labor market behavior or occupation on wages and earnings after the birth of a child. We find limited evidence that low- and middle-skill men experience a “fatherhood premium” after the birth of a child, conditional on child parity and occupation. For men, nearly all occupations were associated with a “wage penalty” after the birth of a child (parity varies) compared to the service sector. However, overall higher wages in many male-dominated and white-collar occupations make these better options for fathers. For women, we see clear evidence of a “motherhood penalty,” which is partly accounted for by employment behaviors, such as switching to a salaried job or making an occupational change.
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We use the National Longitudinal Survey of Youth, 1979 to study the relationships between married men's earnings and marriage and spouse characteristics. We test three theories posited in the literature to explain these relationships-selection, specialization, and cross-productivity. While previous research finds evidence in support of all three explanations, we argue that the empirical models used are underspecified resulting in biased tests of the theories. We estimate a more complete model, encompassing all three theories. We find evidence in support for the selection and specialization hypotheses, but little support for the cross-productivity hypothesis.
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Past research that asserts a fatherhood wage premium often ignores the heterogeneity of fathering contexts. I expect fatherhood to produce wage gains for men if it prompts them to alter their behavior in ways that increase labor-market productivity. Identity theory predicts a larger productivity-based fatherhood premium when ties of biology, coresidence with the child, and marriage to the child's mother reinforce one another, making fatherhood, and the role of financial provider in particular, salient, high in commitment, and clear. Employer discrimination against fathers in less normative family structures may also contribute to variation in the fatherhood premium. Using fixed-effects models and data from the 1979 cohort of the National Longitudinal Survey of Youth (NLSY79), I find that married, residential, biological fatherhood is associated with wage gains of about 4 percent, but unmarried residential fathers, nonresidential fathers, and stepfathers do not receive a fatherhood premium. Married residential fathers also receive no statistically significant wage premium when their wives work full-time. About 15 percent of the wage premium for married residential fathers can be explained by changes in human capital and job traits.
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We estimate how parenthood affects hourly wages using panel data for Norwegian employees in the years 1997–2007. Though smaller than for most other OECD countries, we find substantial wage penalties to motherhood, ranging from a 1.2 % wage reduction for women with lower secondary education to 4.9 % for women with more than four years of higher education. Human capital measures such as work experience and paid parental leave do not explain the wage penalties, indicating that in the Norwegian institutional context, mothers are protected from adverse wage effects due to career breaks. We do however find large heterogeneity in the effects, with the largest penalties for mothers working full time and in the private sector. Contrary to most studies using US data and to previous research from Norway, we find a small wage penalty also to fatherhood. Also for men, the penalty is greater for those who work full time and in the private sector. A substantial share of the fatherhood wage penalty is explained by paternity leave.
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Women face an earnings penalty associated with motherhood but researchers have paid scant attention to how fatherhood might influence men's long-term earnings. Using multiple waves of the National Longitudinal Survey of Youth and employing ordinary least squares regression and fixed effects models we investigate what happens to men who modify their employment for family reasons. Previous research shows that men work longer hours and earn more after becoming fathers, but if men are unemployed or reduce work hours for family reasons, they could experience a “flexibility stigma” depressing earnings and limiting future career opportunities. We find strong support for the flexibility stigma hypothesis. Controlling for the effects of age, race, education, intelligence, occupation, job tenure, work hours, health limitations, marital status, and number of children, we find that men who ever quit work or are unemployed for family reasons earn significantly less than others in the future. Theoretical reasons for observed findings are discussed.
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This paper provides a systematic review of the scientific literature on fertility and its relationship with economics. We explore theoretical and empirical frameworks developed in the last fifty years, emphasizing on the classical (Becker, Easterling) and unorthodox approaches (Bongaarts, Iannaccone, Lehrer). This literature review focused on journals of economics, sociology and demography indexed in the Journal Storage database (JSTOR), Elsevier’s research database (ScienceDirect), Elton B. Stephens Company research database (EBSCOhost) and Cambridge Information Group’s research database (Proquest). This review suggests that research of household behavior regarding decisions to participate in the labor market and fertility is a vast field of convergence of various multidisciplinary analytical attempts. Accordingly, economics has focused on this field through a multidisciplinary approach.
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Research on the labor-supply consequences of childbearing is complicated by the endogeneity of fertility. This study uses parental preferences for a mixed sibling-sex composition to construct instrumental variables (IV) estimates of the effect of childbearing on labor supply. IV estimates for women are significant but smaller than ordinary least-squares estimates. The IV are also smaller for more educated women and show no impact of family size on husbands' labor supply. A comparison of estimates using sibling-sex composition and twins instruments implies that the impact of a third child disappears when the child reaches age thirteen. Copyright 1998 by American Economic Association.
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Although the primacy of household responsibilities in determining gender differences in labor market outcomes is universally recognized, there has been little investigation of the direct effect of housework on wages. Using data from the Panel Study of Income Dynamics, cross-sectional wage regressions reveal a substantial negative relation between wages and housework for wives, which persists in specifications controlling for individual fixed effects. The evidence for husbands is inconclusive. Married women's housework time is, on average, three times that of married men's. The addition of housework time to the wage equations increases the explained component of the gender wage gap from 27-30 percent to 38 percent.
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Although estimates of the fertility-labor supply relationship abound, a full appreciation of the interpretation of such estimates has been lacking, regardless of the empirical strategy employed. This paper attempts to elucidate, within the context of a life-cycle decision-making process, the information contained in the estimated association between fertility and labor supply as calculated from "single" and "simultaneous-equations" estimation techniques. We also present a statistical methodology based upon the occurrence of twins in the first pregnancy and provide estimates, using that methodology, of the extent to which women's life-cycle labor supply decisions respond to exogenous (and, in this case, unanticipated) extra children.
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A new measure of 'voraciousness' in leisure activities is introduced as an indicator of the pace of leisure, facili-tating a theoretical linkage between the literature on time pressure, busyness and harriedness in late modernity, and the literature on cultural consumption. On the methodological side it is shown that time use diaries can pro-vide at least as good a measure of the pace of leisure as survey based measures. Respondents with a high score on the voraciousness measure ('harried' respondents) are not less likely to complete their diaries than less harried respondents. In accord with the findings from the literature on cultural omnivorousness, the most voracious groups are those with high levels of social status and human capital. However, these associations are not due to these groups having either higher income or greater quantities of available leisure time. The pace of leisure ac-tivities must therefore be due to other factors, for example, could a fast pace of out-of-home leisure participation be conceived of as a new marker of status distinction?
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This paper brings together and integrates social interactions and the special relation between quantity and quality. We are able to show that the observed quality income elasticity would be relatively high and the quantity elasticity relatively low and sometimes negative, even if the true "unobserved� income elasticities for quantity and quality were equal and of average value. Moreover, the observed quality elasticity would fall, and the observed quantity elasticity would rise, as parental income rose.
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This paper emphasises the importance of incorporating household production into the 'collective model' of the household, and considers how and to what extent the results of Chiappori (1992) can be extended to this case.
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Wage differentials between men and women are often attributed to differences in on-the-job training-the lower investment of women being explained by their plans to interrupt their careers for family reasons. Career interruptions, however, are often explained by low wages. To trace this interrelationship, the author adopts a simultaneous equations approach-trying to explain wages, planned separations, on-the-job training, and the skill intensity of the job simultaneously. Skill intensity is found to be a key variable in the explanation of the wage differential. Traditional theory is hard pressed to explain the sex-related differences in this variable. Copyright 1988 by University of Chicago Press.
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Increasing returns from specialized human capital is a powerful force creating a division of labor in the allocation of time and investments in human capital between married men and married women. Moreover, since child care and housework are more effort intensive than leisure and other household activities, married women spend less effort on each hour of market work than married men working the same number of hours. Hence, married women have lower hourly earnings than married men with the same market human capital, and they economize on the effort expended on market work by seeking less demanding jobs. The responsibility of married women for child care and housework has major implications for earnings and occupational differences between men and women.
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Identification in errors-in-variables regression models was recently extended to wide models classes by S. Schennach (Econometrica, 2007) (S) via use of generalized functions. In this paper the problems of non- and semi- parametric identification in such models are re-examined. Nonparametric identification holds under weaker assumptions than in (S); the proof here does not rely on decomposition of generalized functions into ordinary and singular parts, which may not hold. Conditions for continuity of the identification mapping are provided and a consistent nonparametric plug-in estimator for regression functions in the L₁ space constructed. Semiparametric identification via a finite set of moments is shown to hold for classes of functions that are explicitly characterized; unlike (S) existence of a moment generating function for the measurement
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As the gender gap in pay between women and men has been narrowing, the 'family gap' in pay between mothers and nonmothers has been widening. One reason may be the institutional structure in the United States, which has emphasized equal pay and opportunity policies but not family policies, in contrast to other countries that have implemented both. The authors now have evidence on the links between one such family policy and women's pay. Recent research suggests that maternity leave coverage, by raising women's retention after childbirth, also raises women's levels of work experience, job tenure, and pay. Copyright 1998 by American Economic Association.
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This chapter presents a survey on the labor supply of men. This survey of male labor supply covers the determinants of whether men work for pay in the labor market and, if so, the determinants of their hours of work. The chapter also discusses the work behavior of men prior to their retirement from the labor force. Moreover, even though there are noteworthy investigations into the labor supply of men in many different countries, this survey is restricted almost entirely to the Anglo-American literature. The chapter identifies the major time-series and cross-section empirical regularities in male labor supply behavior. It is these that any economic theory should be designed to address. The chapter presents the canonical static model of labor supply and then immediately proceeds to deal with the problems in applying this model at the aggregative level. The static model is amended to handle the situation of nonlinear budget constraints. The chapter concludes with an outline of the most popular life-cycle model of labor supply. The chapter also addresses the issues in and results from the estimation of the static model. Problems in specifying the model are first considered and then the results are presented from the U.S. nonexperimental literature, the British literature, and the U.S. experimental literature. The chapter also discusses the estimates from the applications of the life-cycle model.
Child costs and instrumental-variable estimates of the effect of fertility on labor supply: comment on Angrist and Evans
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Rosenzweig, M. and Wolpin, K. I. (1998).`Child costs and instrumental-variable estimates of the effect of fertility on labor supply: comment on Angrist and Evans.' unpublished manuscript.
The in¯uence of children on the wage rates of married womenThe sensitivity of an empirical model of married women's hours of work to economic and statistical assumptions
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Shadow prices, market wages, and labor supplyThe in¯uence of children on the wage rates of married womenThe sensitivity of an empirical model of married women's hours of work to economic and statistical assumptions
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