IDEAS home Printed from https://ideas.repec.org/p/diw/diwsop/diw_sp685.html
   My bibliography  Save this paper

Does It Pay to Be a Woman?: Labour Demand Effects of Maternity-Related Job Protection and Replacement Incomes

Author

Listed:
  • Beatrice Scheubel

Abstract

In countries with strong employment protection laws it is often considered to be unwise to hire a woman in childbearing age because she might get pregnant. However, such labour demand e ects of job protection measures related to maternity leave are often rather anecdotal. To provide analytical evidence, this paper studies the impact of changes in maternity-related job protection in Germany on employment opportunities for women in childbearing age without children for whom the observed e ects should be largely demand-related. Exogenous, discrete policy changes in the German labour market of the 1980s and 1990s constitute the setting for a difference-in-differences analysis of the transition into employment as well as wages. The data for this study are taken from the German Socio-Economic Panel and from the German Microcensus. Doubling the job-protected leave period from 6 months to 12 months between 1986 and 1988 led to an approximately 6% lower probability of being hired for women in childbearing age without a university degree.In addition, I nd a 5-10% increase in wages for women in childbearing age associated with the latter reform. Since this effect disappears when controlling for having a child in the future, this may indicate an increased need to signal commitment by increased effort after the reform.

Suggested Citation

  • Beatrice Scheubel, 2014. "Does It Pay to Be a Woman?: Labour Demand Effects of Maternity-Related Job Protection and Replacement Incomes," SOEPpapers on Multidisciplinary Panel Data Research 685, DIW Berlin, The German Socio-Economic Panel (SOEP).
  • Handle: RePEc:diw:diwsop:diw_sp685
    as

    Download full text from publisher

    File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.482308.de/diw_sp0685.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Haefke, Christian & Sonntag, Marcus & van Rens, Thijs, 2013. "Wage rigidity and job creation," Journal of Monetary Economics, Elsevier, vol. 60(8), pages 887-899.
    2. Baum, Charles II, 2003. "The effect of state maternity leave legislation and the 1993 Family and Medical Leave Act on employment and wages," Labour Economics, Elsevier, vol. 10(5), pages 573-596, October.
    3. Boeri, Tito, 1999. "Enforcement of employment security regulations, on-the-job search and unemployment duration," European Economic Review, Elsevier, vol. 43(1), pages 65-89, January.
    4. Cahuc, Pierre & Postel-Vinay, Fabien, 2002. "Temporary jobs, employment protection and labor market performance," Labour Economics, Elsevier, vol. 9(1), pages 63-91, February.
    5. Datta Gupta, Nabanita & Smith, Nina, 2002. "Children and Career Interruptions: The Family Gap in Denmark," Economica, London School of Economics and Political Science, vol. 69(276), pages 609-629, November.
    6. Krause, Michael U. & Uhlig, Harald, 2012. "Transitions in the German labor market: Structure and crisis," Journal of Monetary Economics, Elsevier, vol. 59(1), pages 64-79.
    7. van Ham, Maarten & Büchel, Felix, 2004. "Females' Willingness to Work and the Discouragement Effect of a Poor Local Childcare Provision," IZA Discussion Papers 1220, Institute for the Study of Labor (IZA).
    8. Olivier Thévenon & Anne Solaz, 2013. "Labour Market Effects of Parental Leave Policies in OECD Countries," OECD Social, Employment and Migration Working Papers 141, OECD Publishing.
    9. Puhani, Patrick A, 2000. " The Heckman Correction for Sample Selection and Its Critique," Journal of Economic Surveys, Wiley Blackwell, vol. 14(1), pages 53-68, February.
    10. Dias, Daniel A. & Marques, Carlos Robalo & Martins, Fernando, 2013. "Wage rigidity and employment adjustment at the firm level: Evidence from survey data," Labour Economics, Elsevier, vol. 23(C), pages 40-49.
    11. Ronny Freier & Viktor Steiner, 2010. "'Marginal employment' and the demand for heterogeneous labour - elasticity estimates from a multi-factor labour demand model for Germany," Applied Economics Letters, Taylor & Francis Journals, vol. 17(12), pages 1177-1182.
    12. Ondrich, Jan & Spiess, C Katharina & Yang, Qing, 1996. "Barefoot and in a German Kitchen: Federal Parental Leave and Benefit Policy and the Return to Work after Childbirth in Germany," Journal of Population Economics, Springer;European Society for Population Economics, vol. 9(3), pages 247-266, August.
    13. Antonis Adam & Thomas Moutos, 2014. "Industry-level labour demand elasticities across the Eurozone: will there be any gain after the pain of internal devaluation?," Working Papers 185, Bank of Greece.
    14. Lisa Powell, 1998. "Part-time versus full-time work and child care costs: evidence for married mothers," Applied Economics, Taylor & Francis Journals, vol. 30(4), pages 503-511.
    15. Ch. Pissarides., 2011. "The Unemployment Volatility Puzzle: Is Wage Stickiness the Answer?," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 1.
    16. FFF1Michaela NNN1Kreyenfeld, 2004. "Fertility Decisions in the FRG and GDR: An Analysis with Data from the German Fertility and Family Survey," Demographic Research Special Collections, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 3(11), pages 275-318, April.
    17. Daniela Del Boca, 2002. "The effect of child care and part time opportunities on participation and fertility decisions in Italy," Journal of Population Economics, Springer;European Society for Population Economics, vol. 15(3), pages 549-573.
    18. Edward P. Lazear, 1990. "Job Security Provisions and Employment," The Quarterly Journal of Economics, Oxford University Press, vol. 105(3), pages 699-726.
    19. Christopher J. Ruhm, 1998. "The Economic Consequences of Parental Leave Mandates: Lessons from Europe," The Quarterly Journal of Economics, Oxford University Press, vol. 113(1), pages 285-317.
    20. Saint-Paul, Gilles, 1997. "The Rise and Persistence of Rigidities," American Economic Review, American Economic Association, vol. 87(2), pages 290-294, May.
    21. Stephen Nickell, 1997. "Unemployment and Labor Market Rigidities: Europe versus North America," Journal of Economic Perspectives, American Economic Association, vol. 11(3), pages 55-74, Summer.
    22. Goux, Dominique & Maurin, Eric & Pauchet, Marianne, 2001. "Fixed-term contracts and the dynamics of labour demand," European Economic Review, Elsevier, vol. 45(3), pages 533-552, March.
    23. Dräger, Vanessa & Marx, Paul, 2012. "Do Firms Demand Temporary Workers When They Face Workload Fluctuation? Cross-Country Firm-Level Evidence on the Conditioning Effect of Employment Protection," IZA Discussion Papers 6894, Institute for the Study of Labor (IZA).
    24. Waldfogel, Jane, 1998. "The Family Gap for Young Women in the United States and Britain: Can Maternity Leave Make a Difference?," Journal of Labor Economics, University of Chicago Press, vol. 16(3), pages 505-545, July.
    25. Miriam Beblo & Stefan Bender & Elke Wolf, 2009. "Establishment-level wage effects of entering motherhood," Oxford Economic Papers, Oxford University Press, vol. 61(suppl_1), pages 11-34, April.
    26. Gilles Saint Paul, 2000. "The 'new political economy': Two recent books," Economics Working Papers 462, Department of Economics and Business, Universitat Pompeu Fabra.
    27. 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.
    28. C. Katharina Spieß & Katharina Wrohlich, 2006. "The Parental Leave Benefit Reform in Germany: Costs and Labour Market Outcomes of Moving towards the Scandinavian Model," Discussion Papers of DIW Berlin 630, DIW Berlin, German Institute for Economic Research.
    29. Gert G. Wagner & Joachim R. Frick & Jürgen Schupp, 2007. "The German Socio-Economic Panel Study (SOEP) – Scope, Evolution and Enhancements," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 127(1), pages 139-169.
    30. Dennis Görlich & Andries de Grip, 2009. "Human capital depreciation during hometime," Oxford Economic Papers, Oxford University Press, vol. 61(suppl_1), pages 98-121, April.
    31. Flinn, C. & Heckman, J., 1982. "New methods for analyzing structural models of labor force dynamics," Journal of Econometrics, Elsevier, vol. 18(1), pages 115-168, January.
    32. Saint-Paul, Gilles, 2000. "The Political Economy of Labour Market Institutions," OUP Catalogue, Oxford University Press, number 9780198293323.
    33. Sabine Klinger & Thomas Rothe, 2012. "The Impact of Labour Market Reforms and Economic Performance on the Matching of the Short‐term and the Long‐term Unemployed," Scottish Journal of Political Economy, Scottish Economic Society, vol. 59(1), pages 90-114, February.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Maternity leave legislation; gender pay gap; education; unemployment; difference-in-differences with group-correlated errors; quasi-natural experiment;

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • 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
    • K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:diw:diwsop:diw_sp685. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Bibliothek). General contact details of provider: http://edirc.repec.org/data/sodiwde.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.