Charles A. Dice Center Working Paper No. 2019-29
77 Pages Posted: 22 Nov 2019 Last revised: 5 Dec 2019
Date Written: November 19, 2019
We examine whether reducing frictions in the labor market affects the performance of private and public firms. Using the staggered adoption of state-level Paid Family Leave acts, we provide causal evidence on the value created by relieving frictions to female talent allocation. The magnitude of firms’ improved performance is correlated with their exposure to the laws. We document that reduced turnover, increased productivity, and female leadership are important mechanisms leading to the observed performance gains.
Keywords: Firm Performance, Gender, Labor Force Participation, Paid Family Leave, Talent Allocation
JEL Classification: J16, J22, J24, J32, J78, M14, M51
Suggested Citation: Suggested Citation