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Wage effects of motherhood: a double selection approach

Wage differentials between mothers and childless women are estimated correcting for the selectivity bias resulting from two double selection processes: firstly, the motherhood decision and the employment decision, and secondly the motherhood decision and the decision to be employed in a less demanding job. We use Dutch data on women’s wages and construct an indicator for less demanding jobs. Our estimations indicate that the motherhood decision is strongly correlated with both employment and having a less demanding job. This suggests that ignoring these correlations will lead to inconsistent parameter estimations of wage equations. The selectivity corrected estimation of women’s wage differentials indicate that a large part of the wage differential is composed by discrimination compared to estimations without correction for selectivity.

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Paper provided by Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho in its series NIMA Working Papers with number 22.

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Length: 24 pages
Date of creation: Jun 2003
Date of revision:
Handle: RePEc:nim:nimawp:22
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  1. Hans-Peter Kohler & José Antonio Ortega, 2002. "Tempo-Adjusted Period Parity Progression Measures:," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 6(7), pages 145-190, March.
  2. Deborah J. Anderson & Melissa Binder & Kate Krause, 2002. "The Motherhood Wage Penalty: Which Mothers Pay It and Why?," American Economic Review, American Economic Association, vol. 92(2), pages 354-358, May.
  3. Deborah J. Anderson & Melissa Binder & Kate Krause, 2003. "The motherhood wage penalty revisited: experience, heterogeneity, work effort, and work-schedule flexibility," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 56(2), pages 273-294, January.
  4. Van de Ven, Wynand P. M. M. & Van Praag, Bernard M. S., 1981. "The demand for deductibles in private health insurance : A probit model with sample selection," Journal of Econometrics, Elsevier, vol. 17(2), pages 229-252, November.
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