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Female labour market outcomes and the impact of maternity leave policies

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  • Hamish Low
  • Virginia Sánchez-Marcos

Abstract

This paper shows how family policies aimed at reconciling the pressures of family and work generate substantial variation in labour market outcomes across developed countries. We use a life-cycle model of female labour supply and savings behaviour, calibrated to the US economy, to assess the effect of introducing to the US a maternity leave policy similar to Scandinavian-type policies. We focus on the impact on gender differences in participation and in wages. We distinguish between the effect of the job protection offered by maternity leave and the effect of income replacement. Job protection leads to substantial increases in participation of mothers with children under 6, but with little long term effects. The effects on wages are minimal, with negative selection effects offsetting the reduced human capital depreciation. Income replacement has a limited impact on participation or wages. JEL codes: J13; J18; J22 Copyright Low and Sánchez-Marcos. 2015

Suggested Citation

  • Hamish Low & Virginia Sánchez-Marcos, 2015. "Female labour market outcomes and the impact of maternity leave policies," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-22, December.
    • Handle: RePEc:spr:izalbr:v:4:y:2015:i:1:p:1-22:10.1186/s40172-015-0029-1
    DOI: 10.1186/s40172-015-0029-1
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    2. LINA ELSIE MORAA & Dr. Muthoni Mainah, 2023. "Impact of Gender-Inclusive Labor Policies on Women’s Employment in Isiolo County, Kenya," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 7(6), pages 1441-1461, June.
    3. Tu Thi Ngoc Le & Ngoc Thi Bich Pham, 2021. "The gender employment gap: the effects of extended maternity leave policy in Viet Nam," WIDER Working Paper Series wp-2021-171, World Institute for Development Economic Research (UNU-WIDER).
    4. repec:cge:wacage:519 is not listed on IDEAS
    5. Molly Mayer & Céline Le Bourdais, 2019. "Sharing Parental Leave Among Dual-Earner Couples in Canada: Does Reserved Paternity Leave Make a Difference?," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 38(2), pages 215-239, April.
    6. Christopher Rauh & Aranu Valladares-Esteban, 2023. "On the black-white gaps in labor supply and earnings over the lifecycle in the US," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 51, pages 424-449, December.
    7. repec:cge:wacage:518 is not listed on IDEAS
    8. Guyonne Kalb, 2018. "Paid Parental Leave and Female Labour Supply: AÂ Review," The Economic Record, The Economic Society of Australia, vol. 94(304), pages 80-100, March.
    9. Farré, Lídia, 2016. "Parental Leave Policies and Gender Equality: A Survey of the Literature/Permisos de Paternidad e igualdad de género: Una revisión de la literatura," Estudios de Economia Aplicada, Estudios de Economia Aplicada, vol. 34, pages 45-60, Enero.
    10. Fallon, Kathleen M. & Mazar, Alissa & Swiss, Liam, 2017. "The Development Benefits of Maternity Leave," World Development, Elsevier, vol. 96(C), pages 102-118.
    11. Troeger, Vera E. & Di Leo, Riccardo & Scotto, Thomas J. & Epifanio, Mariaelisa, 2020. "Motherhood in Academia : A Novel Dataset with an Application to Maternity Leave Uptake," The Warwick Economics Research Paper Series (TWERPS) 1312, University of Warwick, Department of Economics.
    12. Troeger, Vera E. & Di Leo, Riccardo & Scotto, Thomas J. & Epifanio, Mariaelisa, 2020. "The Motherhood Penalties : Insights from Women in UK Academia," The Warwick Economics Research Paper Series (TWERPS) 1313, University of Warwick, Department of Economics.

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    More about this item

    Keywords

    Labor supply; Maternal leave; Returns to work;
    All these keywords.

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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