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Trapped at Home: The Effect of Mothers' Temporary Labor Market Exits on their Subsequent Work Career

  • Nina Drange
  • Mari Rege

This paper investigates how mothers’ decision to stay at home with young children affects their subsequent work careers. Identification is based on the introduction of the Cash-for-Care program in Norway in 1998, which increased mothers’ incentives to withdraw from the labor market when their child was one and two years old. Our estimates demonstrate that the program had effects on earnings and full-time employment even when the child was no longer eligible for Cash-for-Care at ages four and five. However, from age six, we can no longer see any effects. The effects seem to dissipate because most mothers remained attached to the labor force through part-time employment.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2012/wp-cesifo-2012-05/cesifo1_wp3833.pdf
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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 3833.

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Date of creation: 2012
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Handle: RePEc:ces:ceswps:_3833
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  1. Matt Jackson, 2003. "The Effects of Social Networks on Employment and Inequality," Theory workshop papers 658612000000000032, UCLA Department of Economics.
  2. Gordon B. Dahl & Lance Lochner, 2011. "The Impact of Family Income on Child Achievement: Evidence from the Earned Income Tax Credit," Working Papers 2011-022, Human Capital and Economic Opportunity Working Group.
  3. Jacob Mincer & Solomon Polachek, 1974. "Family Investments in Human Capital: Earnings of Women," NBER Chapters, in: Marriage, Family, Human Capital, and Fertility, pages 76-110 National Bureau of Economic Research, Inc.
  4. Sara Cools & Jon H. Fiva & Lars Johannessen Kirkebøen, 2011. "Causal effects of paternity leave on children and parents," Discussion Papers 657, Research Department of Statistics Norway.
  5. Michael Baker & Kevin Milligan, 2008. "How Does Job-Protected Maternity Leave Affect Mothers' Employment?," Journal of Labor Economics, University of Chicago Press, vol. 26(4), pages 655-691, October.
  6. Christopher J. Ruhm, 1998. "The Economic Consequences Of Parental Leave Mandates: Lessons From Europe," The Quarterly Journal of Economics, MIT Press, vol. 113(1), pages 285-317, February.
  7. Jacob Mincer & Solomon Polacheck, 1974. "Family Investments in Human Capital: Earnings of Women," NBER Chapters, in: Economics of the Family: Marriage, Children, and Human Capital, pages 397-431 National Bureau of Economic Research, Inc.
  8. Magne Mogstad & Chiara Pronzato, 2012. "Are Lone Mothers Responsive to Policy Changes? Evidence from a Workfare Reform in a Generous Welfare State," Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(4), pages 1129-1159, December.
  9. Mari Rege & Ingeborg Solli, 2013. "The Impact of Paternity Leave on Fathers’ Future Earnings," Demography, Springer, vol. 50(6), pages 2255-2277, December.
  10. Eric Bettinger & Torbjørn Haegeland & Mari Rege, 2013. "Home with Mom: The Effects of Stay-at-Home Parents on Children's Long-Run Educational Outcomes," CESifo Working Paper Series 4274, CESifo Group Munich.
  11. Rafael Lalive & Josef Zweimüller, 2009. "How does Parental Leave Affect Fertility and Return to Work? Evidence from Two Natural Experiments," The Quarterly Journal of Economics, MIT Press, vol. 124(3), pages 1363-1402, August.
  12. Jacob Mincer & Haim Ofek, 1982. "Interrupted Work Careers: Depreciation and Restoration of Human Capital," Journal of Human Resources, University of Wisconsin Press, vol. 17(1), pages 3-24.
  13. Gordon B. Dahl & Lance Lochner, 2005. "The Impact of Family Income on Child Achievement," NBER Working Papers 11279, National Bureau of Economic Research, Inc.
  14. Jonah B. Gelbach, 2002. "Public Schooling for Young Children and Maternal Labor Supply," American Economic Review, American Economic Association, vol. 92(1), pages 307-322, March.
  15. Pål Schøne, 2004. "Labour supply effects of a cash-for-care subsidy," Journal of Population Economics, Springer, vol. 17(4), pages 703-727, December.
  16. Marit Rønsen, 2009. "Long-term Effects of Cash for Childcare on Mothers' Labour Supply," LABOUR, CEIS, vol. 23(3), pages 507-533, 09.
  17. Schönberg, Uta & Ludsteck, Johannes, 2007. "Maternity Leave Legislation, Female Labor Supply, and the Family Wage Gap," IZA Discussion Papers 2699, Institute for the Study of Labor (IZA).
  18. Magne Mogstad & Chiara Pronzato, 2008. "Are lone mothers responsive to policy changes? The effects of a Norwegian workfare reform on earnings, education and poverty," Working Papers 008, "Carlo F. Dondena" Centre for Research on Social Dynamics (DONDENA), Università Commerciale Luigi Bocconi.
  19. Lawrence M. Berger & Jane Waldfogel, 2004. "Maternity leave and the employment of new mothers in the United States," Journal of Population Economics, Springer, vol. 17(2), pages 331-349, 06.
  20. Ghazala Naz, 2004. "The impact of cash-benefit reform on parents’ labour force participation," Journal of Population Economics, Springer, vol. 17(2), pages 369-383, 06.
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