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Credit market competition and the gender gap: evidence from local labor markets

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  • Popov, Alexander
  • Zaharia, Sonia

Abstract

We exploit the exogenous variation in regional credit market contestability brought on by banking deregulation in the United States to study the narrowing of the gender gap in local labor markets. We find that deregulation reduced the gender gap in labor force participation, as the subsequent increase in the demand for labor induced non-working women to enter the labor force. Deregulation also reduced wage inequality as women became more likely to work in the private sector, to enter high-paid "male" jobs, and to acquire higher education. Tests of contiguous MSAs sharing a state border corroborate a genuine deregulation effect. JEL Classification: G28, J16, J22

Suggested Citation

  • Popov, Alexander & Zaharia, Sonia, 2017. "Credit market competition and the gender gap: evidence from local labor markets," Working Paper Series 2086, European Central Bank.
    • Handle: RePEc:ecb:ecbwps:20172086
    Note: 861282
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    More about this item

    Keywords

    bank deregulation; gender gap; labor force participation; wage inequality;
    All these keywords.

    JEL classification:

    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • 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

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