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What Is the Case for Paid Maternity Leave?


  • B. Dahl, Gordon

    () (Department of Economics, University of California San Diego)

  • V. Løken, Katrine

    () (Department of Economics, University of Bergen)

  • Mogstad, Magne

    () (Department of Economics, University College London & Research Department, Statistics Norway)

  • Vea Salvanes, Kari

    () (Department of Economics, University of Oslo)


Paid maternity leave has gained greater salience in the past few decades as mothers have increasingly entered the workforce. Indeed, the median number of weeks of paid leave to mothers among OECD countries was 14 in 1980, but had risen to 42 by 2011. We assess the case for paid maternity leave, focusing on parents' responses to a series of policy reforms in Norway which expanded paid leave from 18 to 35 weeks (without changing the length of job protection). Our first empirical result is that none of the reforms seem to crowd out unpaid leave. Each reform increases the amount of time spent at home versus work by roughly the increased numb er of weeks allowed. Since income replacement was 100% for most women, the reforms caused an increase in mother's time spent at home after birth, without a reduction in family income. Our second set of empirical results reveals the expansions had little effect on a wide variety of outcomes, including children's school outcomes, parental earnings and participation in the lab or market in the short or long run, completed fertility, marriage or divorce. Not only is there no evidence that each expansion in isolation had economically signicant effects, but this null result holds even if we cumulate our estimates across all expansions from 18 to 35 weeks. Our third finding is that paid maternity leave has negative redistribution properties. The program makes regressive transfers both from ineligibles to eligibles and within the group of eligible mothers. Since there was no crowd out of unpaid leave, the extra leave benefits amounted to a pure leisure transfer, primarily to middle and upper income families. Finally, we investigate the financial costs of the extensions in paid maternity leave. We find these reforms had little impact on parents' future tax payments and benefit receipt. As a result, the large increases in public spending on maternity leave imply a considerable increase in taxes, at a cost to economic efficiency. Taken together, our finding suggest the generous extensions to paid leave were costly, had no measurable effect on outcomes and poor redistribution properties. In a time of harsh budget realities, our findings have important implications for countries that are considering future expansions or contractions in the duration of paid leave.

Suggested Citation

  • B. Dahl, Gordon & V. Løken, Katrine & Mogstad, Magne & Vea Salvanes, Kari, 2013. "What Is the Case for Paid Maternity Leave?," Working Papers in Economics 09/13, University of Bergen, Department of Economics.
  • Handle: RePEc:hhs:bergec:2013_009

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    References listed on IDEAS

    1. David S. Lee & Thomas Lemieux, 2010. "Regression Discontinuity Designs in Economics," Journal of Economic Literature, American Economic Association, vol. 48(2), pages 281-355, June.
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    9. Tarjei Havnes & Magne Mogstad, 2011. "No Child Left Behind: Subsidized Child Care and Children's Long-Run Outcomes," American Economic Journal: Economic Policy, American Economic Association, vol. 3(2), pages 97-129, May.
    10. Yoshio Higuchi & Jane Waldfogel & Masahiro Abe, 1999. "Family leave policies and women's retention after childbirth: Evidence from the United States, Britain, and Japan," Journal of Population Economics, Springer;European Society for Population Economics, vol. 12(4), pages 523-545.
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    Blog mentions

    As found by, the blog aggregator for Economics research:
    1. Paid maternity leaves are regressive
      by Economic Logician in Economic Logic on 2013-11-25 21:10:00


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    Cited by:

    1. Mosca, Irene & O'Sullivan, Vincent & Wright, Robert E., 2017. "Maternal Employment and Child Outcomes: Evidence from the Irish Marriage Bar," IZA Discussion Papers 11085, Institute for the Study of Labor (IZA).
    2. Rita Ginja & Jenny Jans & Arizo Karimi, 2017. "Parental Investments in Early Life and Child Outcomes: Evidence from Swedish Parental Leave Rules," Working Papers 2017-085, Human Capital and Economic Opportunity Working Group.
    3. Sylvia Frühwirth-Schnatter & Christoph Pamminger & Andrea Weber & Rudolf Winter-Ebmer, 2016. "Mothers' long-run career patterns after first birth," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 179(3), pages 707-725, June.
    4. Douglas Almond & Janet Currie & Valentina Duque, 2017. "Childhood Circumstances and Adult Outcomes: Act II," NBER Working Papers 23017, National Bureau of Economic Research, Inc.
    5. Pichler, Stefan & Ziebarth, Nicolas R., 2017. "The pros and cons of sick pay schemes: Testing for contagious presenteeism and noncontagious absenteeism behavior," Journal of Public Economics, Elsevier, vol. 156(C), pages 14-33.
    6. Claudia Olivetti & Barbara Petrongolo, 2017. "The Economic Consequences of Family Policies: Lessons from a Century of Legislation in High-Income Countries," Journal of Economic Perspectives, American Economic Association, vol. 31(1), pages 205-230, Winter.
    7. Bassford, Micaela & Fisher, Hayley, 2016. "Bonus babies? The impact of paid parental leave on fertility intentions," Working Papers 2016-04, University of Sydney, School of Economics.
    8. Johannes Geyer & Peter Haan & Katharina Wrohlich, 2014. "The Effects of Family Policy on Mothers' Labor Supply: Combining Evidence from a Structural Model and a Natural Experiment," Discussion Papers of DIW Berlin 1366, DIW Berlin, German Institute for Economic Research.
    9. Anna Raute, 2017. "Can Financial Incentives Reduce the Baby Gap? Evidence from a Reform in Maternity Leave Benefits," NBER Working Papers 23793, National Bureau of Economic Research, Inc.
    10. Beuchert, Louise Voldby & Humlum, Maria Knoth & Vejlin, Rune, 2016. "The length of maternity leave and family health," Labour Economics, Elsevier, vol. 43(C), pages 55-71.
    11. Løken, Katrine V. & Lommerud, Kjell Erik & Reiso, Katrine Holm, 2014. "Single Mothers and their children: Evaluating a work-encouraging welfare reform," Working Papers in Economics 04/14, University of Bergen, Department of Economics.
    12. Bergemann, Annette & Riphahn, Regina T., 2015. "Maternal Employment Effects of Paid Parental Leave," IZA Discussion Papers 9073, Institute for the Study of Labor (IZA).
    13. Stearns, Jenna, 2015. "The effects of paid maternity leave: Evidence from Temporary Disability Insurance," Journal of Health Economics, Elsevier, vol. 43(C), pages 85-102.
    14. Avendano, Mauricio & Berkman, Lisa F. & Brugiavini, Agar & Pasini, Giacomo, 2015. "The long-run effect of maternity leave benefits on mental health: Evidence from European countries," Social Science & Medicine, Elsevier, vol. 132(C), pages 45-53.
    15. Astrid Kunze, 2016. "Parental leave and maternal labor supply," IZA World of Labor, Institute for the Study of Labor (IZA), pages 279-279, July.
    16. Mosca, Irene & O'Sullivan, Vincent & Wright, Robert E., 2017. "Maternal Employment and Child Outcomes: Evidence from the Irish Marriage Bar," IZA Discussion Papers 11085, Institute for the Study of Labor (IZA).
    17. Mathias Huebener, 2016. "Parental Leave Policies and Child Development: A Review of Empirical Findings," DIW Roundup: Politik im Fokus 102, DIW Berlin, German Institute for Economic Research.

    More about this item


    Paid maternity leave; redistribution effects of social programs;

    JEL classification:

    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy

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