Modelling the Employment and Wage Outcomes of Spouses: Is She Outearning Him?

36 Pages Posted: 23 May 2008

See all articles by Hans Bloemen

Hans Bloemen

VU University Amsterdam; IZA Institute of Labor Economics; Tinbergen Institute; Netspar

Elena Stancanelli

Paris School of Economics (PSE)

Abstract

This paper is focused on couple households where the wife is the main earner. The economic literature on this subject is particularly scant. According to our estimates, the wife was the main earner in one of every six couple households in France in 2002, including wife-sole-earner households. The proportion of wives outearning their husbands was 18% for dual-earners. About 24% of American women in dual-earner households earned more than their husband in 2004. Using a model of household labour supply behaviour, we show that households where the wife is the main earner may come about either because the husband has a weaker preference for work than his wife, due possibly to her high wage, or because he is hit by adverse circumstances, such as, for example, a decline in the demand for men with his particular qualifications. Positive assortative mating may also come into play. Our empirical model specifies spouse labour-market participation equations within each household, endogenizing wages and allowing for random effects and correlations in spouses' unobservables. We conclude that the determinants of wife-sole-earner households are quite distinct from those for dual-earner households where she outearns him. The probability of observing the first seems to be more related to labour market difficulties of the husband, while the latter is not. Dual-earners where she outearns him are more likely to be found among higher educated couples, and especially, among couple where the wife's education level is high.

Keywords: marriage, work behaviour, household economics

JEL Classification: D1, J12, J21

Suggested Citation

Bloemen, Hans and Stancanelli, Elena, Modelling the Employment and Wage Outcomes of Spouses: Is She Outearning Him?. IZA Working Paper No. 3455, Available at SSRN: https://ssrn.com/abstract=1136176 or http://dx.doi.org/10.1111/j.0042-7092.2007.00700.x

Hans Bloemen (Contact Author)

VU University Amsterdam ( email )

De Boelelaan 1105
Amsterdam, ND North Holland 1081 HV
Netherlands

IZA Institute of Labor Economics

Schaumburg-Lippe-Str. 7 / 9
Bonn, D-53072
Germany

Tinbergen Institute

Gustav Mahlerplein 117
Amsterdam, 1082 MS
Netherlands

Netspar

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Elena Stancanelli

Paris School of Economics (PSE) ( email )

48 Boulevard Jourdan
Paris, 75014 75014
France

HOME PAGE: http://www.parisschoolofeconomics.eu/fr/stancanelli-elena/

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