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The lifetime gender gap in Italy. Do the pension system countervails labour market outcomes?

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  • Roberto Leombruni
  • Michele Mosca

Abstract

In Italy large work career gender gaps currently exists, particularly regarding wages and activity rates. The paper investigates the issue looking at lifetime incomes, where from the one side all the career gaps tend to accumulate, from the other the redistribution acted by the pension system may mitigate the differences. Exploiting an original database on the entire work careers, we document how the pay gap constantly opens with age and how women tend to cumulate lower seniority. Both gaps have an impact in the pension calculation, so that the day after retirement gender differences are even higher. By means of a microsimulation model we show that the pension system partially countervails labour market outcomes, implying lower differences in lifetime incomes. However, due to the current transition to an actuarially neutral system, the effect is going to vanish in following decades, posing some concerns about future prospects of gender income inequality.

Suggested Citation

  • Roberto Leombruni & Michele Mosca, 2011. "The lifetime gender gap in Italy. Do the pension system countervails labour market outcomes?," LABORatorio R. Revelli Working Papers Series 113, LABORatorio R. Revelli, Centre for Employment Studies.
  • Handle: RePEc:cca:wplabo:113
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    References listed on IDEAS

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    1. Roberto Leombruni & Matteo Richiardi, 2006. "LABORsim: An Agent-Based Microsimulation of Labour Supply – An Application to Italy," Computational Economics, Springer;Society for Computational Economics, vol. 27(1), pages 63-88, February.
    2. Ghazala Azmat & Maia Güell & Alan Manning, 2006. "Gender Gaps in Unemployment Rates in OECD Countries," Journal of Labor Economics, University of Chicago Press, vol. 24(1), pages 1-38, January.
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    4. Del Boca, Daniela & Sauer, Robert M., 2009. "Life cycle employment and fertility across institutional environments," European Economic Review, Elsevier, vol. 53(3), pages 274-292, April.
    5. Alan Manning & Joanna Swaffield, 2008. "The gender gap in early-career wage growth," Economic Journal, Royal Economic Society, vol. 118(530), pages 983-1024, July.
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    14. William E. Even & David A. Macpherson, 1994. "Gender Differences in Pensions," Journal of Human Resources, University of Wisconsin Press, vol. 29(2), pages 555-587.
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    16. Martin Schindler, 2009. "The Italian Labor Market; Recent Trends, Institutions, and Reform Options," IMF Working Papers 09/47, International Monetary Fund.
    17. Elena Bardasi & Stephen P. Jenkins, 2010. "The Gender Gap In Private Pensions," Bulletin of Economic Research, Wiley Blackwell, vol. 62(4), pages 343-363, October.
    18. Daniela Del Boca & Silvia Pasqua & Chiara Pronzato, 2005. "Fertility and Employment in Italy, France, and the UK," LABOUR, CEIS, vol. 19(s1), pages 51-77, December.
    19. Michele Belloni & Carlo Maccheroni, 2013. "Actuarial Fairness When Longevity Increases: An Evaluation of the Italian Pension System," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 38(4), pages 638-674, October.
    20. Sami Napari, 2006. "The Early Career Gender Wage Gap," CEP Discussion Papers dp0738, Centre for Economic Performance, LSE.
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