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Department of Economics, Norwegian School of Economics (NHH) Discussion Paper Series in Economics, Department of Economics, Norwegian School of Economics (NHH)

No 4/2012:
Work and Wage Dynamics around Childbirth.

Mette Ejrnæs () and Astrid Kunze ()

Abstract: This study investigates how the first childbirth affects the wage processes of women who are well-established in the labour market. We estimate a flexible …fixed-effects wage regression model extended by post-childbirth…fixed effects. We use register data on West Germany and exploit the expansionary family policy during the late 1980s and 1990s for identification. On their return to work after childbirth, mothers’wages drop by 3 to 5.7 per cent per year of leave. We find negative selection back to full-time work after childbirth. We discuss policy implications regarding statistical discrimination and results concerning the family gap.

Keywords: Wages; parental leave; human capital; control function.; (follow links to similar papers)

JEL-Codes: C23; J24; J31; (follow links to similar papers)

32 pages, February 29, 2012

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