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Parental Leave Duration and Wages: A Structural Approach

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  • Laurent Lequien

    (CREST)

Abstract

We investigate the existence of causal mechanisms from parental leave duration to subsequent wages. Our instrumental variable is a French reform giving financial incentives to take a parental leave. Two longitudinal datasets provide us with information on wages and familial background from 1976 to 2005. In our context, panel data estimations potentially suffer from unobserved heterogeneity, endogeneity and selection. We implement an innovative procedure proposed by Semykina and Wooldridge (2010) to take into account these three problems simultaneously. We find that parental leave duration has a significant and negative causal impact on later wages

Suggested Citation

  • Laurent Lequien, 2012. "Parental Leave Duration and Wages: A Structural Approach," Working Papers 2012-04, Center for Research in Economics and Statistics.
    • Handle: RePEc:crs:wpaper:2012-04
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    References listed on IDEAS

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    1. Ekberg, John & Eriksson, Rickard & Friebel, Guido, 2013. "Parental leave — A policy evaluation of the Swedish “Daddy-Month” reform," Journal of Public Economics, Elsevier, vol. 97(C), pages 131-143.
    2. Jan Ondrich & Katharina C. Spieß & Qing Yang, 2002. "The Effect of Maternity Leave on Women's Pay in Germany 1984-1994," Discussion Papers of DIW Berlin 289, DIW Berlin, German Institute for Economic Research.
    3. James J. Heckman, 1976. "The Common Structure of Statistical Models of Truncation, Sample Selection and Limited Dependent Variables and a Simple Estimator for Such Models," NBER Chapters, in: Annals of Economic and Social Measurement, Volume 5, number 4, pages 475-492, National Bureau of Economic Research, Inc.
    4. Mette Ejrnæs & Astrid Kunze, 2002. "Wage dips and drops around the first birth," 10th International Conference on Panel Data, Berlin, July 5-6, 2002 C2-4, International Conferences on Panel Data.
    5. Green, Francis, 2010. "Well-being, job satisfaction and labour mobility," Labour Economics, Elsevier, vol. 17(6), pages 897-903, December.
    6. Angrist, Joshua D, 1990. "Lifetime Earnings and the Vietnam Era Draft Lottery: Evidence from Social Security Administrative Records," American Economic Review, American Economic Association, vol. 80(3), pages 313-336, June.
    7. Michael P. Keane & Kenneth I. Wolpin, 2002. "Estimating Welfare Effects Consistent with Forward-Looking Behavior. Part I: Lessons from a Simulation Exercise," Journal of Human Resources, University of Wisconsin Press, vol. 37(3), pages 570-599.
    8. Robert Jäckle & Oliver Himmler, 2010. "Health and Wages: Panel Data Estimates Considering Selection and Endogeneity," Journal of Human Resources, University of Wisconsin Press, vol. 45(2).
    9. Marco Francesconi, 2002. "A Joint Dynamic Model of Fertility and Work of Married Women," Journal of Labor Economics, University of Chicago Press, vol. 20(2), pages 336-380, Part.
    10. Rafael Lalive & Josef Zweim�ller, "undated". "Does Parental Leave Affect Fertility and Return-to-Work? Evidence from a �True Natural Experiment�," IEW - Working Papers 242, Institute for Empirical Research in Economics - University of Zurich.
    11. Wooldridge, Jeffrey M., 1995. "Selection corrections for panel data models under conditional mean independence assumptions," Journal of Econometrics, Elsevier, vol. 68(1), pages 115-132, July.
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    15. Semykina, Anastasia & Wooldridge, Jeffrey M., 2010. "Estimating panel data models in the presence of endogeneity and selection," Journal of Econometrics, Elsevier, vol. 157(2), pages 375-380, August.
    16. Bianca Buligescu & Denis de Crombrugghe & Gülçin Menteşoğlu & Raymond Montizaan, 2009. "Panel estimates of the wage penalty for maternal leave," Oxford Economic Papers, Oxford University Press, vol. 61(suppl_1), pages 35-55, April.
    17. James W. Albrecht & Per-Anders Edin & Marianne Sundström & Susan B. Vroman, 1999. "Career Interruptions and Subsequent Earnings: A Reexamination Using Swedish Data," Journal of Human Resources, University of Wisconsin Press, vol. 34(2), pages 294-311.
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    Cited by:

    1. John Bailey Jones & Minhee Kim & Byoung G. Park, 2020. "The Wage Penalty for Married Women of Career Interruptions: Evidence from the 1970s and the 1990s," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 82(4), pages 783-807, August.
    2. Givord, Pauline & Marbot, Claire, 2015. "Does the cost of child care affect female labor market participation? An evaluation of a French reform of childcare subsidies," Labour Economics, Elsevier, vol. 36(C), pages 99-111.

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    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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