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The Family Gap in Pay: Evidence from Seven Industrialised Countries

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  • Susan Harkness
  • Jane Waldfogel
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    Abstract

    In this paper we use microdata on employment and earnings from a variety of industrialised countries to investigate the family gap in pay - the differential in hourly wages between women with children and women without children. We present results from seven countries: Australia, Canada, the United Kingdom, the United States, Germany, Finland, and Sweden. We find that there is a good deal of variation across our sample countries in the effects of children on women's employment. We also find large differences in the effects of children on women's hourly wages even after controlling for differences between women with children and women without children in characteristics such as age and education. Among the seven countries we study here, the United Kingdom displays the largest wage penalties to children. The family gap in pay is larger in the U.K. than in other countries because of the higher propensity of U.K. mothers to work in low-paid part-time jobs but also because even among full-timers, women with children in the U.K. are lower paid relative to other women than are mothers in other countries. Why does the family gap in pay vary so much across countries? We find that the variation in the family gap in pay across countries is not primarily due to differential selection into employment or to differences in wage structure. We therefore suggest that future research should examine the impact of family policies such as maternity leave and child care on the family gap in pay.

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    File URL: http://sticerd.lse.ac.uk/dps/case/cp/CASEpaper30.pdf
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    Bibliographic Info

    Paper provided by Centre for Analysis of Social Exclusion, LSE in its series CASE Papers with number 030.

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    Date of creation: Dec 1999
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    Handle: RePEc:cep:sticas:030

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    Web page: http://sticerd.lse.ac.uk/case/_new/publications/default.asp

    Related research

    Keywords: Womens earnings; effects of children on incomes;

    References

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    1. Francine D. Blau & Lawrence Kahn, 1995. "The Gender Earnings Gap: Some International Evidence," NBER Chapters, in: Differences and Changes in Wage Structures, pages 105-144 National Bureau of Economic Research, Inc.
    2. Albrecht, James W. & Edin, Per-Anders & Sundström, Marianne & Vroman, Susan B., 1996. "Career Interruptions and Subsequent Earnings: A Reexamination Using Swedish Data," Working Paper Series 1996:23, Uppsala University, Department of Economics.
    3. David Neumark & Sanders Korenman, 1994. "Sources of Bias in Women's Wage Equations: Results Using Sibling Data," Journal of Human Resources, University of Wisconsin Press, vol. 29(2), pages 379-405.
    4. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January.
    5. Mincer, Jacob & Polachek, Solomon, 1974. "Family Investment in Human Capital: Earnings of Women," Journal of Political Economy, University of Chicago Press, vol. 82(2), pages S76-S108, Part II, .
    6. Jacob Mincer & Solomon Polacheck, 1974. "Family Investments in Human Capital: Earnings of Women," NBER Chapters, in: Economics of the Family: Marriage, Children, and Human Capital, pages 397-431 National Bureau of Economic Research, Inc.
    7. Rosholm, Michael & Smith, Nina, 1996. "The Danish Gender Wage Gap in the 1980s: A Panel Data Study," Oxford Economic Papers, Oxford University Press, vol. 48(2), pages 254-79, April.
    8. Tim Callan & S. Adam & S. Dex & S. Gustafsson & J. Schupp & N. Smith, 1995. "Gender Wage Differentials: New Cross-Country Evidence," Papers WP062, Economic and Social Research Institute (ESRI).
    9. Becker, Gary S, 1985. "Human Capital, Effort, and the Sexual Division of Labor," Journal of Labor Economics, University of Chicago Press, vol. 3(1), pages S33-58, January.
    10. Jane Waldfogel, 1998. "Understanding the "Family Gap" in Pay for Women with Children," Journal of Economic Perspectives, American Economic Association, vol. 12(1), pages 137-156, Winter.
    11. Susan Harkness, 1996. "The gender earnings gap: evidence from the UK," Fiscal Studies, Institute for Fiscal Studies, vol. 17(2), pages 1-36, May.
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    Cited by:
    1. Cooke, Lynn Prince, 2001. "Impact of Dual Careers on Average Family Size: Comparison of 11 Countries," IRISS Working Paper Series 2001-05, IRISS at CEPS/INSTEAD.
    2. Maria Evandrou & Jane Falkingham & Tom Sefton, 2009. "Women's family histories and incomes in later life in the UK, US and West Germany," LSE Research Online Documents on Economics 28242, London School of Economics and Political Science, LSE Library.
    3. Cooke, Lynn Prince, 2000. "Gender Agency at the Intersection of State, Market and Family: Changes in Fertility and Maternal Labor Supply in Eight Countries," IRISS Working Paper Series 2000-09, IRISS at CEPS/INSTEAD.
    4. Erin Todd & Dennis Sullivan, 2002. "Children and Household Income Packages: A Cross-National Analysis," American Economic Review, American Economic Association, vol. 92(2), pages 359-362, May.
    5. Zhang, Xuelin, 2008. "Emploi des meres canadiennes apres la naissance d'un enfant et trajectoires des gains de leurs homologues occupees de facon continue, 1983 a 2004," Direction des etudes analytiques : documents de recherche 2008314f, Statistics Canada, Direction des etudes analytiques.
    6. Maria Evandrou & Jane Falkingham & Tom Sefton, 2008. "Women’s family histories and incomes in later life in the UK, US and West Germany," LSE Research Online Documents on Economics 43864, London School of Economics and Political Science, LSE Library.

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