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The Motherhood Penalty: Is It a Wage-Dependent Family Decision?

Author

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  • Gafni Dalit
  • Siniver Erez

    (School of Economics, The College of Management, 7 Yitzhak Rabin Ave., P.O. Box 9017, Rishon Letzion75190, Israel)

Abstract

Recent studies have shown that even highly skilled women suffer a motherhood wage penalty, resulting in reduced pay relative to childless women. We use a unique dataset of all Israeli women who graduated college or university during the period 1995–2008 and their husbands to investigate whether the motherhood penalty is the result of a household decision. Thus, we investigate whether the wage gap between husband and wife before they have children affects the decision of which spouse will be the main provider and which will have the main responsibility for childrearing. We find that the couple’s initial wage ratio does not affect this decision, since a woman almost always bears the opportunity cost of childrearing even if she has a much higher starting wage than her husband.

Suggested Citation

  • Gafni Dalit & Siniver Erez, 2018. "The Motherhood Penalty: Is It a Wage-Dependent Family Decision?," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 18(4), pages 1-18, October.
    • Handle: RePEc:bpj:bejeap:v:18:y:2018:i:4:p:18:n:5
    DOI: 10.1515/bejeap-2017-0186
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    References listed on IDEAS

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    More about this item

    Keywords

    motherhood wage gap; compensating wage differentials; career interruptions; time allocation and labor supply;
    All these keywords.

    JEL classification:

    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods

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