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The Parental Wage Gap and the Development of Socio-Emotional Skills in Children

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  • Paul Hufe

Abstract

Converging labor market opportunities of men and women have altered the economic incentives for how families invest monetary and time resources into the skill development of their children. In this paper, I study the causal impact of changes in the parental wage gap (PWG)—defined as the relative difference in potential wages of mothers and fathers—on children’s socio-emotional skills. I leverage administrative and survey data from Germany to create exogenous between-sibling variation in the PWG through a shift-share design. I find that decreases in the PWG do not affect children’s socio-emotional development as measured by their Big Five personality traits and externalizing/internalizing behaviors. This null effect can be rationalized by the offsetting effects of the PWG on monetary investments, i.e., more disposable household income that is increasingly controlled by mothers, and time investments, i.e., a substitution from in-home maternal care to informal childcare.

Suggested Citation

  • Paul Hufe, 2024. "The Parental Wage Gap and the Development of Socio-Emotional Skills in Children," CESifo Working Paper Series 11111, CESifo.
    • Handle: RePEc:ces:ceswps:_11111
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    References listed on IDEAS

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    1. Chernozhukov, Victor & Hansen, Christian, 2008. "The reduced form: A simple approach to inference with weak instruments," Economics Letters, Elsevier, vol. 100(1), pages 68-71, July.
    2. Na'ama Shenhav, 2021. "Lowering Standards to Wed? Spouse Quality, Marriage, and Labor Market Responses to the Gender Wage Gap," The Review of Economics and Statistics, MIT Press, vol. 103(2), pages 265-279, May.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    gender gaps; skill development; parental investments;
    All these keywords.

    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
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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