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New Evidence on the Motherhood Wage Gap

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  • Amuedo-Dorantes, Catalina

    ()
    (San Diego State University)

  • Kimmel, Jean

    ()
    (Western Michigan University)

Abstract

Using data from the 1979 National Longitudinal Survey of Youth, we assess the role of employment-based health insurance offers in explaining the motherhood wage gap. Researchers have been aware of the existence of a motherhood gap for many years; yet, the literature has failed to address the role of non-wage compensation in explaining the motherhood wage gap despite the increasing importance of non-wage benefits in total compensation packages. As hedonic wage theory suggests, mothers might view health benefits as desirable and trade-off wages for health insurance. Thus, lower wages for mothers might reflect their relative preferences for jobs offering health insurance. We estimate an endogenous switching wage equation model to account for the self-selection and, thus, endogeneity of having an employment-based health insurance offer. We find that, once the endogeneity of having an employment-based health insurance offer is accounted for, the motherhood wage gap disappears.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3662.

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Length: 30 pages
Date of creation: Aug 2008
Date of revision:
Handle: RePEc:iza:izadps:dp3662

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Keywords: motherhood wage gap; non-wage compensation; health insurance;

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References

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  1. Gruber, Jonathan, 1994. "The Incidence of Mandated Maternity Benefits," American Economic Review, American Economic Association, vol. 84(3), pages 622-41, June.
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  4. Deborah J. Anderson & Melissa Binder & Kate Krause, 2003. "The motherhood wage penalty revisited: experience, heterogeneity, work effort, and work-schedule flexibility," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 56(2), pages 273-294, January.
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  20. 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.
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Cited by:
  1. Luis Gamboa & Blanca Zuluaga, 2013. "Is There a Motherhood Penalty? Decomposing the Family Wage Gap in Colombia," Journal of Family and Economic Issues, Springer, vol. 34(4), pages 421-434, December.
  2. Felfe, Christina, 2012. "The motherhood wage gap: What about job amenities?," Labour Economics, Elsevier, vol. 19(1), pages 59-67.
  3. Tarja Viitanen, 2014. "The motherhood wage gap in the UK over the life cycle," Review of Economics of the Household, Springer, vol. 12(2), pages 259-276, June.

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