RT Monograph
SR 00
A1 Barigozzi, Francesca
A1 Cremer, Helmuth
A1 Thibault, Emmanuel
T1 The motherhood wage and income traps
YR 2023
FD 2023-04
VO 23-1426
SP 40
K1 child penalty, mothers' earnings dynamics, multiple equilibria, wage
K1 and income traps
AB We present a simple dynamic model based on on-the-job human capital accumu-  lation affecting the dynamic of wage rates and labor earnings. We show how these  dynamics are determined by the interplay between the supply and demand sides of the  labor market. The model can generate and explain the different dynamics of women's  earnings after childbirth documented in the empirical literature on child penalties. We  show that the temporary negative shock in labor supply due to childbearing may cre-  ate a wage trap and a permanent divergence of labor earnings between genders. Even  when the wage trap is avoided, and working mothers are on a path toward a high-wage  equilibrium, slow convergence can permanently lose earnings. We use this model to  study the impact of different policies on the gender wage gap and child penalties. We  show that mandatory maternal leave exacerbates the shock which pleads against long  leaves. Similarly, cash transfers to mothers via the income effect on labor supply ag-  gravate gender wage di_erences. By contrast, temporary subsidies to mothers' wages  (possibly in the form of Income Tax Credits) are not only useful to exit the wage trap,  but also to speed up recovery and reduce the child penalty when the shock in labor  supply is small enough to avoid the wage trap. Other family policies, like formal child-  care subsidies and in-kind provision of formal childcare, are potentially useful because  they reduce the mothers' cost of labor supply, but they a_ect mothers' choices only  indirectly.
T2 TSE Working Paper
PB TSE Working Paper
PP Toulouse.
AV Published
LK https://publications.ut-capitole.fr/id/eprint/47764/
UL http://tse-fr.eu/pub/128039