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Long-Term Effects of Recession on Parenthood Gender Inequality

Author

Listed:
  • Kim, Jinyoung

    (Korea University)

  • Kwak, Eunhye

    (Korea Labor Institute)

Abstract

This study identifies a new mechanism to account for the persistent gender differences in earnings after childbirth. Aside from women's voluntary wage cuts in pursuit of family-friendly job amenities, we claim that adverse labor market conditions at the time of childbearing widen the gender gap among parents. Employing the instrumental variable (IV) method against a large cross-sectional dataset from the US, we find that giving birth during a recession reduces mothers' earnings, whereas fathers remain mostly unaffected. The asymmetric impact of a recession at the time of childbirth persists for a long time and accounts for 30–40 percent of the after-childbirth gender gap in earnings. Unintended impacts of recession on parenthood gender gap leaves room for government intervention on women's career breaks.

Suggested Citation

  • Kim, Jinyoung & Kwak, Eunhye, 2023. "Long-Term Effects of Recession on Parenthood Gender Inequality," IZA Discussion Papers 16055, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp16055
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    References listed on IDEAS

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    More about this item

    Keywords

    gender gap; recession; long-term effects; fertility; child penalty;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • 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
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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