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Compensating wage differentials and the labor market re-entry of mothers: Evidence from a factorial survey

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  • Drasch, Katrin
  • Abraham, Martin

Abstract

Mothers still earn substantially less than women without children; this discrepancy is often referred to as the motherhood wage penalty. This paper examines one possible explanation for this penalty: the willingness to accept lower-paying jobs that have more favorable characteristics that help women reconcile family and work. This idea was formulated based on the theory of compensating wage differentials (CWDs). A factorial survey is used to empirically examine the willingness to accept lower-paying jobs. An online survey comprised 398 women who interrupted employment due to family reasons. The results suggest that mothers are willing to accept lower wages for better job characteristics and that in addition to wages, non-monetary characteristics are also important in shaping the re-entry decision.

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  • Drasch, Katrin & Abraham, Martin, 2019. "Compensating wage differentials and the labor market re-entry of mothers: Evidence from a factorial survey," SocArXiv vap6x, Center for Open Science.
    • Handle: RePEc:osf:socarx:vap6x
    DOI: 10.31219/osf.io/vap6x
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