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

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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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    References listed on IDEAS

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    1. Mathias Jensen & Abigail Adams & Barbara Petrongolo, 2024. "Birth Timing and Spacing: Implications for Parental Leave Dynamics and Child Penalties," Economics Series Working Papers 1048, University of Oxford, Department of Economics.
    2. Nikolay Angelov & Per Johansson & Erica Lindahl, 2016. "Parenthood and the Gender Gap in Pay," Journal of Labor Economics, University of Chicago Press, vol. 34(3), pages 545-579.
    3. Henrik Kleven & Camille Landais & Johanna Posch & Andreas Steinhauer & Josef Zweimüller, 2019. "Child Penalties across Countries: Evidence and Explanations," AEA Papers and Proceedings, American Economic Association, vol. 109, pages 122-126, May.
    4. Sieppi, Antti & Pehkonen, Jaakko, 2019. "Parenthood and gender inequality: Population-based evidence on the child penalty in Finland," Economics Letters, Elsevier, vol. 182(C), pages 5-9.
    5. Alessandra Casarico & Salvatore Lattanzio, 2023. "Behind the child penalty: understanding what contributes to the labour market costs of motherhood," Journal of Population Economics, Springer;European Society for Population Economics, vol. 36(3), pages 1489-1511, July.
    6. Martin Eckhoff Andresen & Emily Nix, 2022. "What Causes the Child Penalty? Evidence from Adopting and Same-Sex Couples," Journal of Labor Economics, University of Chicago Press, vol. 40(4), pages 971-1004.
    7. Henrik Kleven & Camille Landais & Jakob Egholt Søgaard, 2019. "Children and Gender Inequality: Evidence from Denmark," American Economic Journal: Applied Economics, American Economic Association, vol. 11(4), pages 181-209, October.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

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    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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