The Evolution of Hours Worked and the Gender Wage Gap: Evidence from Four Countries

We examine the contribution of the intensive margin of labour supply (hours worked above zero) to the gender wage gap over a long time-horizon across four high-income economies: France, Germany, the UK, and the US. We do so by bridging a recent literature on gender differences in high-paying, high-hour jobs with traditional wage gap decomposition methods. We first build a model in which firms offer two wage contracts – one that pays a fixed wage but allows workers to choose their preferred number of hours up to "full time", and a second in which wages are determined by imperfectly observable productivity and can require working more than standard hours. The former includes partand full-time work, while the latter requires workers to supply long hours but allows them to earn a higher remuneration. We then decompose the hourly wage gap separately for part-, full-, and overtime workers to observe the relative contribution of sorting and remuneration across these "hours regimes" over time and across countries. We show that while female employment in overtime work has increased and the gender wage gap has decreased in most countries and hours regimes, this was not driven by increasing selection on observables but rather by a decline over time of the unexplained component of the wage gap — a pattern that holds for most countries and hours regimes. We conclude by considering the contribution of institutional framework (unions, labour market flexibility, parental leaves) to these cross-country differences.