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Labour supply responses to paid parental leave

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Author Info

  • Karimi, Arizo

    () (IFAU - Institute for Evaluation of Labour Market and Education Policy)

  • Lindahl, Erica

    () (IFAU - Institute for Evaluation of Labour Market and Education Policy)

  • Skogman Thoursie, Peter

    () (Department of Economics, Stockholm University)

Abstract

Women account for the majority of parental leave take-up, which is likely one of the major reasons for the gender gap in income and wages. Consequently, many countries exert effort to promote a more gender equal division of parental leave. Indeed, the last decades have seen an increase in fathers’ take-up of parental leave benefits, but the gender earnings gap has remained fairly constant. In this paper we re-evaluate the labour supply responses of both mothers and fathers to three major reforms in the Swedish parental leave system, recognizing that take up of paid parental leave might not fully reflect actual time off from work in a system where job-protection exceeds paid leave. We find that both mothers and fathers decreased their labour supply to the same extent as a response to an increase in paid parental leave without gender restrictions. In contrast, we find no support for any changes in fathers’ labour supply due to reforms introducing gender quotas in paid leave.

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Bibliographic Info

Paper provided by IFAU - Institute for Evaluation of Labour Market and Education Policy in its series Working Paper Series with number 2012:22.

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Length: 35 pages
Date of creation: 26 Nov 2012
Date of revision:
Handle: RePEc:hhs:ifauwp:2012_022

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Keywords: natural experiment; parental leave; labour supply;

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References

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  1. Ekberg, John & Eriksson, Rickard & Friebel, Guido, 2005. "Parental Leave – A Policy Evaluation of the Swedish "Daddy-Month" Reform," IZA Discussion Papers 1617, Institute for the Study of Labor (IZA).
  2. Johansson, Per & Palme, Marten, 1996. "Do economic incentives affect work absence? Empirical evidence using Swedish micro data," Journal of Public Economics, Elsevier, vol. 59(2), pages 195-218, February.
  3. Gubta, Nabanita Datta & Smith, Nina, 2000. "Children and Career Interruptions: The Family Gap in Denmark," CLS Working Papers 00-3, University of Aarhus, Aarhus School of Business, Centre for Labour Market and Social Research.
  4. Marianne Bertrand & Claudia Goldin & Lawrence F. Katz, 2010. "Dynamics of the Gender Gap for Young Professionals in the Financial and Corporate Sectors," American Economic Journal: Applied Economics, American Economic Association, vol. 2(3), pages 228-55, July.
  5. Rafael Lalive & Analía Schlosser & Andreas Steinhauer & Josef Zweimüller, 2011. "Parental leave and mothers' careers: the relative importance of job protection and cash benefits," ECON - Working Papers 042, Department of Economics - University of Zurich.
  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. Eriksson, Rickard, 2005. "Parental Leave in Sweden: The Effects of the Second Daddy Month," Working Paper Series 9/2005, Swedish Institute for Social Research.
  8. Wen-Jui, Han & Ruhm, Christopher J. & Waldfogel, Jane, 2007. "Parental Leave Policies and Parents’ Employment and Leave-Taking," IZA Discussion Papers 3244, Institute for the Study of Labor (IZA).
  9. Jacob Mincer & Solomon Polachek, 1974. "Family Investments in Human Capital: Earnings of Women," NBER Chapters, in: Marriage, Family, Human Capital, and Fertility, pages 76-110 National Bureau of Economic Research, Inc.
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  11. Liu, Qian & Nordström Skans, Oskar, 2009. "The duration of paid parental leave and children’s scholastic performance," Working Paper Series 2009:14, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  12. Johansson, Per & Palme, Marten, 2005. "Moral hazard and sickness insurance," Journal of Public Economics, Elsevier, vol. 89(9-10), pages 1879-1890, September.
  13. Ghazala Azmat & Rosa Ferrer Zarzuela, 2012. "Gender gaps in performance: Evidence from young lawyers," Economics Working Papers 1300, Department of Economics and Business, Universitat Pompeu Fabra, revised Mar 2012.
  14. Rebecca Ray & Janet C. Gornick & John Schmitt, 2008. "Parental Leave Policies in 21 Countries: Assessing Generosity and Gender Equality," CEPR Reports and Issue Briefs 2008-23, Center for Economic and Policy Research (CEPR).
  15. Rafael Lalive & Josef Zweimüller, 2009. "How does Parental Leave Affect Fertility and Return to Work? Evidence from Two Natural Experiments," The Quarterly Journal of Economics, MIT Press, vol. 124(3), pages 1363-1402, August.
  16. James W. Albrecht & Per-Anders Edin & Marianne Sundström & Susan B. Vroman, 1999. "Career Interruptions and Subsequent Earnings: A Reexamination Using Swedish Data," Journal of Human Resources, University of Wisconsin Press, vol. 34(2), pages 294-311.
  17. Datta Gupta, Nabanita & Smith, Nina & Verner, Mette, 2006. "Child Care and Parental Leave in the Nordic Countries: A Model to Aspire to?," IZA Discussion Papers 2014, Institute for the Study of Labor (IZA).
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