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The role of parental leave policies in mitigating child penalties: insights from Italy

Author

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  • Biasi, Paola
  • De Paola, Maria

Abstract

This study examines child penalties for mothers and fathers in Italy by using novel administrative data. Relying on an event study approach, we find that childbirth affects mothers' earnings negatively, while fathers' earnings remain largely unaffected. However, when leave allowances are included in earnings, the child penalty for women nearly disappears in the year of childbirth and drops by more than half in the following year. Subsequently mothers’ earnings quickly return to pre-birth levels, but never catch up to fathers' earnings, which follow an upward trajectory, increasing by approximately 46 % seven years after childbirth.

Suggested Citation

  • Biasi, Paola & De Paola, Maria, 2025. "The role of parental leave policies in mitigating child penalties: insights from Italy," Economics Letters, Elsevier, vol. 253(C).
    • Handle: RePEc:eee:ecolet:v:253:y:2025:i:c:s0165176525001922
    DOI: 10.1016/j.econlet.2025.112355
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    More about this item

    Keywords

    Italy; Child penalty; Event study; Gender gap; Labour market; Welfare;
    All these keywords.

    JEL classification:

    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy

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