Establishment-Level Wage Effects of Entering Motherhood

Posted: 21 Apr 2009

See all articles by Miriam Beblo

Miriam Beblo

ZEW – Leibniz Centre for European Economic Research

Stefan Bender

Government of the Federal Republic of Germany - Institute for Employment Research (IAB)

Elke Wolf

Center for European Economic Research (ZEW)

Date Written: April 2009

Abstract

We analyse the wage effects following employment breaks of women who enter motherhood using a novel matching approach where mothers’ wages upon return to work are compared to those of their female colleagues within the same establishment. Using an administrative German data set, we apply a fixed-effects propensity score matching based on information two years before birth of the first child. Our results yield new insights into the nature of the wage penalty associated with motherhood: when matching with establishment-specific effects we find that first births reduce women's wages by 19%, whereas ignoring the identifier and matching across all establishments would yield a wage cut of 26%. We therefore conclude that selection into establishments is an important explanatory factor for the family pay gap.

JEL Classification: J13, J31, C14

Suggested Citation

Beblo, Miriam and Bender, Stefan and Wolf, Elke, Establishment-Level Wage Effects of Entering Motherhood (April 2009). Oxford Economic Papers, Vol. 61, Issue suppl_1, pp. i11-i34, 2009, Available at SSRN: https://ssrn.com/abstract=1389135 or http://dx.doi.org/gpn040

Miriam Beblo (Contact Author)

ZEW – Leibniz Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1 D-68161 Mannheim
Germany

Stefan Bender

Government of the Federal Republic of Germany - Institute for Employment Research (IAB) ( email )

Regensburger Str. 104
Nuremberg, 90478
Germany
+49 911 179 3082 (Phone)
+49 911 179 3297 (Fax)

Elke Wolf

Center for European Economic Research (ZEW) ( email )

P.O. Box 10 34 43
L 7,1 D-68161 Mannheim
Germany

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