The Family Earnings Gap Revisited: A Household or a Labor Market Problem?

Abstract

Using Danish administrative data from 1995-2014, I compare income and wage trajectories of women to those of their partner before and after becoming parents. I then compare within- and across-couple gaps for women in opposite and same-sex households. Since same-sex couples by definition do not experience sex-specific comparative advantages at work or at home, the changes in intra household earnings due to parenthood must be based on other factors than the intra household gender differences. Comparing the dynamics upon adopting a child in opposite and same-sex couples will identify to what extent the gender compared to non-gendered factors determine the observed gender inequality in the child penalty. Contrary to opposite-sex households and heterosexual mothers, for same-sex households, I find only a small child penalty for lesbians and no significant within household differences in earnings trajectories due to parenthood, no matter the mothers’ intra household bargaining power.

Keywords: Gender earnings gap, gender inequality, household division of labor, child penalty, parenthood, same-sex partnerships

JEL Classification: J12, J16, J22, J71