Motherhood Employment Penalty and Gender Wage Gap Across Countries: 1990–2010

Abstract

In this paper, we employ twin birth as an instrument to estimate the effects of fertility on female employment using 72 censuses from 37 countries in 1990–2010. Next, we document a strong linear association between gender wage gap and the estimated motherhood employment penalty both across countries and within countries. Reductions in the gender wage gap are associated with decreases in motherhood employment penalty. Our estimates suggest that a reduction of one percentage-point in the gender wage gap is associated with a decrease of 0.4 percentage-points in the estimated motherhood employment penalty. Our finding supports the notion that job prospects and gender equality in the labor market play a direct role in a mother’s labor supply response to childbirth.