Long-term Effects of Recession on Parenthood Gender Inequality in Labor Market Outcomes

초록

This study identifies an additional channel through which macroeconomic conditions at the time of childbearing may contribute to persistent gender differences in earnings following childbirth. Beyond women's voluntary wage cuts in pursuit of family-friendly job amenities, we argue that unfavorable labor market conditions at the time of childbearing exacerbate the gender gap among parents. Employing the instrumental variable (IV) approach with an extensive cross-sectional dataset from the United States, we establish that giving birth during a recession leads to a reduction in mothers' earnings, while fathers largely remain unaffected. This asymmetric impact of a recession during childbirth persists over a prolonged period and accounts for 1.1-10.7 percent of the post-childbirth gender gap in earnings. The unintended repercussions of economic downturns on the gender disparity in parenthood highlight the potential for government interventions to address women's career interruptions.

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