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On Gender Gaps and Self-fulfilling Expectations: Theory, Policies and Some Empirical Evidence

  • de la Rica, Sara


    (University of the Basque Country)

  • Dolado, Juan J.


    (European University Institute)

  • García-Peñalosa, Cecilia



This paper considers a simple model of self-fulfilling expectations that leads to a multiple equilibrium of gender gaps in wages and participation rates. Rather than resorting to moral hazard problems related to unobservable effort, like in most of the related literature, our model fully relies on statistical discrimination. If firms believe that women will quit their jobs more often than equally productive men when shocks affecting household chores take place, our model predicts that this belief will increase the wage gap in favour of men which, in turn, will exacerbate lower female participation in the labour market. Hence, both effects lead to a gendered equilibrium with large gaps, even though an ungendered equilibrium with no gaps is feasible. We examine the effects of gender-based and gender-neutral subsidies and find that the latter are more effective in removing the gendered equilibrium. Empirical analysis based on a time use survey for Spain is provided to test some implications of the model.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3553.

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Length: 38 pages
Date of creation: Jun 2008
Date of revision:
Publication status: published in: Economic Enquiry, 2012, 51 (3), 1829-1848
Handle: RePEc:iza:izadps:dp3553
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  8. Alesina, Alberto F & Ichino, Andrea & Karabarbounis, Loukas, 2007. "Gender Based Taxation and the Division of Family Chores," CEPR Discussion Papers 6591, C.E.P.R. Discussion Papers.
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  10. Claudia Olivetti, 2006. "Changes in Women's Hours of Market Work: The Role of Returns to Experience," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 9(4), pages 557-587, October.
  11. Stephen Machin & Patrick A. Puhani, 2002. "Subject of Degree and the Gender Wage Differential - Evidence from the UK and Germany," University of St. Gallen Department of Economics working paper series 2002 2002-28, Department of Economics, University of St. Gallen.
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  15. Kjell Erik Lommerud & Odd Rune Straume & Steinar Vagstad, 2013. "Mommy tracks and public policy: On self-fulfilling prophecies and gender gaps in promotion," NIPE Working Papers 5/2013, NIPE - Universidade do Minho.
  16. Altonji, Joseph G. & Blank, Rebecca M., 1999. "Race and gender in the labor market," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 48, pages 3143-3259 Elsevier.
  17. Francine D. Blau & Lawrence M. Kahn, 2000. "Gender Differences in Pay," NBER Working Papers 7732, National Bureau of Economic Research, Inc.
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  19. Saint-Paul, Gilles, 2007. "Against 'Gender-based taxation'," CEPR Discussion Papers 6582, C.E.P.R. Discussion Papers.
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  21. Francois, Patrick, 1998. "Gender discrimination without gender difference: theory and policy responses," Journal of Public Economics, Elsevier, vol. 68(1), pages 1-32, April.
  22. Coate, Stephen & Loury, Glenn C, 1993. "Will Affirmative-Action Policies Eliminate Negative Stereotypes?," American Economic Review, American Economic Association, vol. 83(5), pages 1220-40, December.
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