Parental leave benefits and child penalties

Arbeitspapier

I use the universe of tax returns in Germany and a regression kink design to estimate the impact of the benefit amount available to high-earning women after their first childbirth on subsequent within-couple earnings inequality. Lower benefit amounts result in a reduced earnings gap that persists beyond the benefit period for at least nine years after the birth. The longer-term impacts are driven by couples where the mother earned more than the father pre-birth. Simulations suggest it would take a 50% reduction in the benefit amount to completely eliminate long-run child penalties for sample couples. Lower benefits also reduce take-up of paid leave by mothers, lower the chances of having further children, and have no impact on marital stability.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: DIW Discussion Papers ; No. 2016

Classification and Topics

• Classification: Wirtschaft ; Equity, Justice, Inequality, and Other Normative Criteria and Measurement ; Fiscal Policies and Behavior of Economic Agents: Household ; Fertility; Family Planning; Child Care; Children; Youth ; Economics of Gender; Non-labor Discrimination ; Labor Law ; Personnel Economics: Compensation and Compensation Methods and Their Effects ; Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification
• Subject: Child penalties ; gender inequality in earnings ; social norms ; parental leave policy ; regression kink design

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Waights, Sevrin
• Event: Veröffentlichung
• (who): Deutsches Institut für Wirtschaftsforschung (DIW)
• (where): Berlin
• (when): 2022

Further information

• Handle: http://hdl.handle.net/10419/263160
• Last update: 10.03.2025, 11:43 AM CET