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Labour market effects of reducing the gender gap in parental leave entitlements

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  • Del Rey, Elena
  • Racionero, Maria
  • Silva, Jose I.

Abstract

We explore the effects of parental leave entitlements for mothers and fathers on wages and employment. We consider male and female workers who compete for the same jobs in a labour search and matching model with endogenous job search and leave take-up rates. We identify key theoretical effects and calibrate the model to simulate policy changes in France, Italy, Norway and Portugal. Reducing the gap in parental leave entitlements reduces gender wage gaps and increases gender employment rate gaps in these countries. Leave take-up rates increase with paid leave duration. In general, we find that job search intensity decreases when longer paid leave duration decreases wages.

Suggested Citation

  • Del Rey, Elena & Racionero, Maria & Silva, Jose I., 2021. "Labour market effects of reducing the gender gap in parental leave entitlements," Labour Economics, Elsevier, vol. 72(C).
    • Handle: RePEc:eee:labeco:v:72:y:2021:i:c:s0927537121000713
    DOI: 10.1016/j.labeco.2021.102036
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    Cited by:

    1. Miyazaki, Koichi, 2023. "Efficiency-enhancing role of mandatory leave policy in a search-theoretic model of the labor market," MPRA Paper 116614, University Library of Munich, Germany.

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    More about this item

    Keywords

    Parental leave; Search and matching; Labour market gaps;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy

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