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Gender Gaps in Labor Informality: The Motherhood Effect

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  • Inés Berniell

    (Centro de Estudios Distributivos Laborales y Sociales (CEDLAS) - Instituto de Investigaciones Económicas, Facultad de Ciencias Económicas, Universidad Nacional de La Plata)

  • Lucila Berniell

    (CAF-Development Bank of Latin America, Research Department)

  • Dolores de la Mata

    (CAF-Development Bank of Latin America, Research Department)

  • María Edo

    (Universidad de San Andr´es and CONICET)

  • Mariana Marchionni

    (Centro de Estudios Distributivos Laborales y Sociales (CEDLAS) - Instituto de Investigaciones Económicas, Facultad de Ciencias Económicas, Universidad Nacional de La Plata and CONICET)

Abstract

Recent work has quantified the large negative effects of motherhood on female labor market outcomes in Europe and the US. But these results may not apply to developing countries, where labor markets work differently and informality is widespread. In less developed countries, informal jobs, which typically include microenterprises and self-employment, offer more time flexibility but poorer social protection and lower labor earnings. These characteristics affect the availability of key inputs in the technology to raise children, and therefore may affect the interplay between parenthood and labor market outcomes. Through an event-study approach we estimate short and long-run labor market impacts of children in Chile, an OECD developing country with a relatively large informal sector. We find that the birth of the first child has strong and long lasting effects on labor market outcomes of Chilean mothers, while fathers remain unaffected. Becoming a mother implies a sharp decline in mothers’ labor supply, both in the extensive and intensive margins, and in hourly wages. We also show that motherhood affects the occupational structure of employed mothers, as the share of jobs in the informal sector increases remarkably. In order to quantify what the motherhood effect would have been in the absence of an informal labor market, we build a quantitative model economy, that includes an informal sector which offers more flexible working hours at the expense of lower wages and weaker social protection, and a technology to produce child quality that combines time, material resources and the quality of social protection services. We perform a counterfactual experiment that indicates that the existence of the informal sector in Chile helps to reduce the drop in LFP after motherhood in about 35%. We conclude that mothers find in the informal sector the flexibility to cope with both family and labor responsibilities, although at the cost of resigning contributory social protection and reducing their labor market prospects.

Suggested Citation

  • Inés Berniell & Lucila Berniell & Dolores de la Mata & María Edo & Mariana Marchionni, 2019. "Gender Gaps in Labor Informality: The Motherhood Effect," CEDLAS, Working Papers 0247, CEDLAS, Universidad Nacional de La Plata.
  • Handle: RePEc:dls:wpaper:0247
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    2. Rosa Abraham & Rahul Lahoti & Hema Swaminathan, 2021. "Childbirth and women's labour market transitions in India," WIDER Working Paper Series wp-2021-128, World Institute for Development Economic Research (UNU-WIDER).
    3. Wang, Feicheng & Liang, Zhe & Lehmann, Hartmut, 2021. "Import competition and informal employment: Empirical evidence from China," Center for European, Governance and Economic Development Research Discussion Papers 426, University of Goettingen, Department of Economics.
    4. Wang, Feicheng & Liang, Zhe & Lehmann, Hartmut, 2021. "Import Competition and Informal Employment: Empirical Evidence from China," IZA Discussion Papers 14650, Institute of Labor Economics (IZA).
    5. Inés Berniell & Lucila Berniell & Dolores de la Mata & María Edo & Yarine Fawaz & Matilde P. Machado & Mariana Marchionni, 2020. "Motherhood and the Allocation of Talent," CEDLAS, Working Papers 0270, CEDLAS, Universidad Nacional de La Plata.
    6. Matías Ciaschi, 2020. "Job loss and household labor supply adjustments in developing countries: Evidence from Argentina," CEDLAS, Working Papers 0271, CEDLAS, Universidad Nacional de La Plata.
    7. Berniell, Inés & Berniell, Lucila & de la Mata, Dolores & Edo, María & Marchionni, Mariana, 2021. "Motherhood and flexible jobs: Evidence from Latin American countries," Research Department working papers 1698, CAF Development Bank Of Latinamerica.
    8. Estefanía Galván & Cecilia García-Peñalosa, 2021. "Interactions amongst gender norms: Evidence from US couples," Documentos de Trabajo (working papers) 21-15, Instituto de Economia - IECON.
    9. Victoria Costoya & Lucía Echeverría & María Edo & Ana Rocha & Agustina Thailinger, 2020. "The impact of COVID-19 in the allocation of time within couples. Evidence for Argentina," Working Papers 145, Universidad de San Andres, Departamento de Economia, revised Aug 2020.
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    11. Jorge M. Agüero & Mindy Marks & Neha Raykar, 2020. "Economic Development and the Motherhood Wage Penalty," Working papers 2020-06, University of Connecticut, Department of Economics.

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    More about this item

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J46 - Labor and Demographic Economics - - Particular Labor Markets - - - Informal Labor Market

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