Why Firms Offer Paid Parental Leave: An Exploratory Study

44 Pages Posted: 6 Jan 2020 Last revised: 24 Mar 2024

See all articles by Claudia Goldin

Claudia Goldin

Harvard University

Sari Pekkala Kerr

Wellesley College

Claudia Olivetti

Boston College; National Bureau of Economic Research (NBER)

Date Written: January 2020

Abstract

Why do competitive firms in the US provide paid parental leave (PPL)? Which firms do and to what extent? We use several firm- and individual-level data sets to answer these questions. These include the BLS-Employee Benefit Survey (EBS) for 2010 to 2018 and an extensive firm-level data collection that we compiled. Our work is undergirded by a two-period model with competitive firms whose workers vary by their optimal firm-specific training and the probability that each will remain on the job after PPL is taken. We find that firm-provided PPL has greatly increased in the last two decades and generally covers new fathers. The levels of provision differ greatly by the industry, firm size, and the degree of firm-specific training. But even the top-of-the-line firm in the US provides fewer fully paid parental weeks than does the median OECD nation.

Suggested Citation

Goldin, Claudia and Kerr, Sari Pekkala and Olivetti, Claudia, Why Firms Offer Paid Parental Leave: An Exploratory Study (January 2020). NBER Working Paper No. w26617, Available at SSRN: https://ssrn.com/abstract=3514355

Claudia Goldin (Contact Author)

Harvard University ( email )

1875 Cambridge Street
Cambridge, MA 02138
United States

Sari Pekkala Kerr

Wellesley College ( email )

Claudia Olivetti

Boston College ( email )

140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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