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Modelling the employment and wage outcomes of spouses: is she outearning him?

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Author Info

  • Hans Bloemen

    (CentER (CentER))

  • Elena Stancanelli

    (Théorie économique, modélisation et applications (THEMA))

Abstract

This paper is focused on couple households where the wife is the main earner. The economic literature on this subject is particularly scant. According to our estimates, the wife was the main earner in one of every six couple households in France in 2002, including wife-sole-earner households. The proportion of wives outearning their husbands was 18% for dual-earners. About 24% of American women in dual-earner households earned more than their husband in 2004. Using a model of household labour supply behaviour, we show that households where the wife is the main earner may come about either because the husband has a weaker preference for work than his wife, due possibly to her high wage, or because he is hit by adverse circumstances, such as, for example, a decline in the demand for men with his particular qualifications. Positive assortative mating may also come into play. Our empirical model specifies spouse labour-market participation equations within each household, endogenizing wages and allowing for random effects and correlations in spouses’ unobservables. We conclude that the determinants of wife-sole-earner households are quite distinct from those for dual-earner households where she outearns him. The probability of observing the first seems to be more related to labour market difficulties of the husband, while the latter is not. Dual-earners where she outearns him are more likely to be found among higher educated couples, and especially, among couple where the wife’s education level is high.

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Bibliographic Info

Paper provided by Sciences Po in its series Sciences Po publications with number info:hdl:2441/9665.

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Date of creation: 09 May 2008
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Publication status: Published in SOLE Thirteenth Annual Meetings, pp.1-34
Handle: RePEc:spo:wpmain:info:hdl:2441/9665

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Keywords: Marriage; work behaviour; household economics;

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References

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  1. Apps, Patricia & Rees, Ray, 2005. "Gender, Time Use and Public Policy over the Life Cycle," IZA Discussion Papers 1855, Institute for the Study of Labor (IZA).
  2. Elena Stancanelli, 2007. "Evaluating the impact of the French tax credit on the employment rate of women," Documents de Travail de l'OFCE, Observatoire Francais des Conjonctures Economiques (OFCE) 2007-33, Observatoire Francais des Conjonctures Economiques (OFCE).
  3. Bloemen, Hans G., 2004. "An empirical model of collective household labour supply with nonparticipation," Serie Research Memoranda, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics 0002, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
  4. Apps, P.F. & Rees, R., 1996. "Collective Labor Supply and Household Production," Papers, Australian National University - Department of Economics 301, Australian National University - Department of Economics.
  5. Arthur van Soest, 1995. "Structural Models of Family Labor Supply: A Discrete Choice Approach," Journal of Human Resources, University of Wisconsin Press, vol. 30(1), pages 63-88.
  6. Drago, Robert & Black, David & Wooden, Mark, 2004. "Female Breadwinner Families: Their Existence, Persistence and Sources," IZA Discussion Papers 1308, Institute for the Study of Labor (IZA).
  7. Apps, P.F. & Rees, R., 1993. "Labor Supply, Household Production and Intra-Family Welfare Distribution," Papers, Australian National University - Department of Economics 248, Australian National University - Department of Economics.
  8. François Bourguignon & Thierry Magnac, 1990. "Labor Supply and Taxation in France," Journal of Human Resources, University of Wisconsin Press, vol. 25(3), pages 358-389.
  9. Eissa, Nada & Hoynes, Hilary Williamson, 2004. "Taxes and the labor market participation of married couples: the earned income tax credit," Journal of Public Economics, Elsevier, Elsevier, vol. 88(9-10), pages 1931-1958, August.
  10. Elena Stancanelli, 2007. "Marriage and Work: an analysis for French couples in the last decade," Documents de Travail de l'OFCE, Observatoire Francais des Conjonctures Economiques (OFCE) 2007-10, Observatoire Francais des Conjonctures Economiques (OFCE).
  11. Pencavel, John, 1998. "Assortative Mating by Schooling and the Work Behavior of Wives and Husbands," American Economic Review, American Economic Association, American Economic Association, vol. 88(2), pages 326-29, May.
  12. Patricia Apps, 2006. "Family Taxation: An Unfair and Inefficient System," CEPR Discussion Papers, Centre for Economic Policy Research, Research School of Economics, Australian National University 524, Centre for Economic Policy Research, Research School of Economics, Australian National University.
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Cited by:
  1. Chiappori, Pierre-André & Iyigun, Murat & Weiss, Yoram, 2006. "Investment in Schooling and the Marriage Market," IZA Discussion Papers 2454, Institute for the Study of Labor (IZA).
  2. Mansour, Hani & McKinnish, Terra, 2012. "Who Marries Differently-Aged Spouses? Earnings, Ability and Appearance," IZA Discussion Papers 6678, Institute for the Study of Labor (IZA).
  3. Zeenat Soobedar, 2011. "A semiparametric analysis of the rising breadwinner role of women in the UK," Review of Economics of the Household, Springer, Springer, vol. 9(3), pages 415-428, September.

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