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Trapped at Home: The Effect of Mothers' Temporary Labor Market Exits on their Subsequent Work Career

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  • Nina Drange
  • Mari Rege

Abstract

This paper investigates how mothers’ decision to stay at home with young children affects their subsequent work careers. Identification is based on the introduction of the Cash-for-Care program in Norway in 1998, which increased mothers’ incentives to withdraw from the labor market when their child was one and two years old. Our estimates demonstrate that the program had effects on earnings and full-time employment even when the child was no longer eligible for Cash-for-Care at ages four and five. However, from age six, we can no longer see any effects. The effects seem to dissipate because most mothers remained attached to the labor force through part-time employment.

Suggested Citation

  • Nina Drange & Mari Rege, 2012. "Trapped at Home: The Effect of Mothers' Temporary Labor Market Exits on their Subsequent Work Career," CESifo Working Paper Series 3833, CESifo.
    • Handle: RePEc:ces:ceswps:_3833
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    Cited by:

    1. Biewen Martin & Seifert Stefanie, 2018. "Potential Parenthood and Career Progression of Men and Women – A Simultaneous Hazards Approach," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 18(2), pages 1-22, April.
    2. Eric Bettinger & Torbjørn Haegeland & Mari Rege, 2014. "Home with Mom: The Effects of Stay-at-Home Parents on Children's Long-Run Educational Outcomes," Journal of Labor Economics, University of Chicago Press, vol. 32(3), pages 443-467.
    3. Corekcioglu, Gozde & Francesconi, Marco & Kunze, Astrid, 2024. "Expansions in paid parental leave and mothers’ economic progress," European Economic Review, Elsevier, vol. 169(C).
    4. Marc K. Chan & Robert Moffitt, 2018. "Welfare Reform and the Labor Market," Annual Review of Economics, Annual Reviews, vol. 10(1), pages 347-381, August.
    5. Doerr, Annabelle, 2022. "Vocational training for female job returners - Effects on employment, earnings and job quality," Labour Economics, Elsevier, vol. 75(C).
    6. Mohammad Arshad Rahman & Angela Vossmeyer, 2019. "Estimation and Applications of Quantile Regression for Binary Longitudinal Data," Advances in Econometrics, in: Topics in Identification, Limited Dependent Variables, Partial Observability, Experimentation, and Flexible Modeling: Part B, volume 40, pages 157-191, Emerald Group Publishing Limited.
    7. Drange, Nina, 2012. "Crowding out Dad? The Effect of a Cash-for-Care Subsidy on Family time Allocation," UiS Working Papers in Economics and Finance 2012/3, University of Stavanger.
    8. Løken, Katrine V. & Lommerud, Kjell Erik & Holm Reiso, Katrine, 2018. "Single mothers and their children: Evaluating a work-encouraging welfare reform," Journal of Public Economics, Elsevier, vol. 167(C), pages 1-20.
    9. Synøve N. Andersen & Nina Drange & Trude Lappegård, 2018. "Can a cash transfer to families change fertility behaviour?," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 38(33), pages 897-928.
    10. Synøve N. Andersen & Nina Drange & Trude Lappegård, 2015. "Can a cash transfer to families change fertility behaviour?," Discussion Papers 800, Statistics Norway, Research Department.
    11. Vedeler Johnsen, Julian & Holm Reiso, Katrine, 2017. "Economic Impacts of Workfare Reforms for Single Mothers: Benefit Substitution and Labour supply responses," Working Papers in Economics 4/17, University of Bergen, Department of Economics.
    12. Drange, Nina & Havnes, Tarjei & Sandsør, Astrid M.J., 2016. "Kindergarten for all: Long run effects of a universal intervention," Economics of Education Review, Elsevier, vol. 53(C), pages 164-181.
    13. Rannveig Kaldager Hart & Taryn A. Galloway, 2023. "Universal Transfers, Tax Breaks and Fertility: Evidence from a Regional Reform in Norway," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 42(3), pages 1-32, June.
    14. Jochimsen, Beate & Fendel, Tanja, 2022. "Home Care Allowance and Labor Market Participation of Immigrant and Native-Born Mothers," VfS Annual Conference 2022 (Basel): Big Data in Economics 264104, Verein für Socialpolitik / German Economic Association.
    15. Janna Bergsvik & Kenneth Aarskaug Wiik & Ragni Hege Kitterød, 2018. "Parenthood and couples’ relative earnings in Norway 2005-2014," Discussion Papers 873, Statistics Norway, Research Department.
    16. Doerr, Annabelle, 2022. "Vocational Training for Female Job Returners - Effects on Employment, Earnings and Job Quality," Working papers 2022/02, Faculty of Business and Economics - University of Basel.
    17. Ruzik-Sierdzińska, Anna, 2018. "Krótkookresowe skutki programu Rodzina 500+," Studia z Polityki Publicznej / Public Policy Studies, Warsaw School of Economics, vol. 5(1), pages 1-14, January.
    18. Doerr, Annabelle, 2017. "Back to work: The Long-term Effects of Vocational Training for Female Job Returners," VfS Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking 168213, Verein für Socialpolitik / German Economic Association.
    19. Davide Dottori & Francesca Modena & Giulia Martina Tanzi, 2023. "Measuring peer effects in parental leaves: evidence from a reform," Temi di discussione (Economic working papers) 1399, Bank of Italy, Economic Research and International Relations Area.
    20. Dottori, Davide & Modena, Francesca & Tanzi, Giulia Martina, 2024. "Peer effects in parental leave: Evidence from Italy," Labour Economics, Elsevier, vol. 89(C).
    21. Reiso, Katrine Holm, 2014. "The Effect of Welfare Reforms on Benefit Substitution," Discussion Paper Series in Economics 22/2014, Norwegian School of Economics, Department of Economics.
    22. Andersland, Leroy & Nilsen, Øivind A., 2016. "Households’ responses to price changes of formal childcare," Discussion Paper Series in Economics 20/2016, Norwegian School of Economics, Department of Economics.
    23. Marit Rønsen & Ragni Hege Kitterød, 2015. "Gender-Equalizing Family Policies and Mothers' Entry into Paid Work: Recent Evidence From Norway," Feminist Economics, Taylor & Francis Journals, vol. 21(1), pages 59-89, January.

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    More about this item

    Keywords

    female labor supply; family; home production; parental leave;
    All these keywords.

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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