Do Family Policies Reduce Gender Inequality? Evidence from 60 Years of Policy Experimentation
Do family policies reduce gender inequality in the labor market? We contribute to this debate by investigating the joint impact of parental leave and child care, using administrative data covering the labor market and birth histories of Austrian workers over more than half a century. We start by quasi-experimentally identifying the causal effects of all family policy reforms since the 1950s on the full dynamics of male and female earnings. We then map these causal estimates into a decomposition framework a la Kleven, Landais and Søgaard (2019) to compute counterfactual gender gaps. Our results show that the enormous expansions of parental leave and child care subsidies have had virtually no impact on gender convergence.
We thank Francine Blau, Hilary Hoynes, Emmanuel Saez, Johannes Spinnewijn, Gabriel Zucman, and seminar participants at the AEA Meetings 2019, Bank of Italy, UC Berkeley, Bocconi, Crest-Ecole Polytechnique, EIEF, OeGB Innsbruck, PSE, National Bank of Belgium, Stockholm University, University of Salzburg, and Queen Mary. We gratefully acknowledge support from the Center for Economic Behavior and Inequality (CEBI) at the University of Copenhagen, financed by grant #DNRF134 from the Danish National Research Foundation. Camille Landais gratefully acknowledges support from the LSE International Inequality Institute and from ERC grant #679704-DYNAMICSS. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.