If ignored, the motherhood wage penalty may
threaten the effectiveness of policies targeting fertility
The motherhood wage penalty denotes the
difference in wages between mothers and women without children that is not
explained by differences in human capital characteristics and labor market
experience. As part of the gender pay gap, the motherhood wage penalty can
represent a significant cost to being female and having children. If
ignored, it may undermine policy initiatives aiming to increase fertility
rates in post-socialist countries, such as the costly “baby bonus,” which is
a government payment to new parents to assist with the costs of
How and why do the careers of men and women
differ? What policies could reduce the differences?
The gender wage gap is largely due to men and
women holding different kinds of jobs. This job segregation is partly driven
by gender differences in careers in corporate hierarchies. Research has
shown that the careers of men and women begin to diverge immediately upon
entry into the labor market and that subsequent career progress exacerbates
the divergence. This divergence of career progress explains a large part of
the gender wage gap. Understanding how and why the careers of men and women
differ is necessary to design effective policies that can reduce the gender
differences in hierarchies.
An unequal distribution of resources within the
family is a special concern for female poverty
Transition to a market economy is accompanied by
a period of greater economic uncertainty. Women are likely to suffer
substantial disadvantages from this uncertainty compared to men as they are,
for example, more likely to lose their job. This not only implies a monetary
loss for the entire family, but also degrades female bargaining power within
the household, possibly further aggravating their well-being. When
intra-household inequality—an unequal distribution of resources among family
members—exists, female poverty might be significantly larger than what can
be deduced using standard household based poverty measures.
Gender gaps in wages and leadership positions
are large—Why, and what can be done about it?
Gender wage gaps and women’s underrepresentation
in leadership positions exist at remarkably similar magnitudes across
countries at all levels of income per capita. Women’s educational attainment
and labor market participation have improved, but this has been insufficient
to close the gaps. A combination of economic forces, cultural and social
norms, discrimination, and unequal legal rights appear to be contributing to
gender inequality. A range of policy options (such as quotas) have been
implemented in some countries; some have been successful, whereas for others
the effects are still unclear.
A range of other policies and changes are needed
for childcare expansion to increase mothers’ labor supply
In 2002, the EU set targets for expanding
childcare coverage, but most of the post-socialist countries are behind
schedule. While childcare expansion places a heavy financial burden on
governments, low participation in the labor force by mothers, especially
those with children under the age of three, implies a high potential impact.
However, the effectiveness of childcare expansion may be limited by some
common characteristics of these countries: family policies that do not
support women’s labor market re-entry, few flexible work opportunities, and
cultural norms about family and gender roles shaped by the institutional and
economic legacy of socialism.
Knowing people’s history helps in understanding
their present state and where they are heading
Information from longitudinal surveys transforms
snapshots of a given moment into something with a time dimension. It
illuminates patterns of events within an individual’s life and records
mobility and immobility between older and younger generations. It can track
the different pathways of men and women and people of diverse socio-economic
background through the life course. It can join up data on aspects of a
person’s life, health, education, family, and employment and show how these
domains affect one another. It is ideal for bridging the different silos of
policies that affect people’s lives.
Does the extent of competition in labor markets
explain why female workers are paid less than men?
There are pronounced and persistent wage
differences between men and women in all parts of the world. A significant
element of these wage disparities can be attributed to differences in worker
and workplace characteristics, which are likely to mirror differences in
worker productivity. However, a large part of these differences remains
unexplained, and it is common to attribute them to discrimination by the
employer that is rooted in prejudice against female workers. Yet recent
empirical evidence suggests that, to a large extent, the gaps reflect
“monopsonistic” wage discrimination—that is, employers exploiting their
wage-setting power over women—rather than any sort of prejudice.
The success of universal preschool education depends crucially
on the policy parameters and specific country context
Since the 1970s, many countries have established free or highly
subsidized education for all preschool children in the hope of improving children’s learning
and socio-economic life chances and encouraging mothers to join the labor force. Evaluations
reveal that these policies can increase maternal employment in the short term and may continue
to do so even after the child is no longer in preschool by enabling mothers to gain more job
skills and increase their attachment to the labor force. However, their effectiveness depends
on the policy design, the country context, and the characteristics of mothers of
Family-friendly policies increase women’s labor
force participation, benefiting them, their families, and society at
Female labor force participation is mainly
driven by the value of women’s market wages versus the value of their
non-market time. Labor force participation by women varies considerably
across countries. To understand this international variation, one must
further consider differences across countries in institutions, non-economic
factors such as cultural norms, and public policies. Such differences
provide important insights into what actions countries might take to further
increase women’s participation in the labor market.
Parental leave increases the family–work balance, but may
have negative impacts on mothers’ careers
Numerous studies have investigated whether the provision
and generosity of parental leave affects the employment and career prospects of women.
Parental leave systems typically provide either short unpaid leave mandated by the firm,
as in the US, or more generous and universal leave mandated by the government, as in
Canada and several European countries. Key economic policy questions include whether, at
the macro level, female employment rates have increased due to parental leave policies;
and, at the micro level, whether the probability of returning to work and career
prospects have increased for mothers after childbirth.