Early Roots of Inequality: Evidence of a Gender Income Gap Among Children

Abstract

The gender pay gap among adults is well documented. This article uncovers an analogous gender income gap between girls and boys aged 6 to 15, where 'income' is defined as the amount of money children receive from their parents. Our analysis is based on large-scale, longitudinal data by a financial service provider that parents use to transfer money to their children. The data reveal that the gender income gap exists as early as age 6, when girls receive 6.36% less income than boys. The gap then grows throughout childhood (age 6 to 10), before diminishing and eventually reversing in adolescence (age 11 to 15). However, the data also show that (a) it takes almost a decade for girls to reach cumulative income parity with boys, despite girls completing more household tasks, and (b) the income gap in childhood means that girls never catch up with boys in terms of savings capacity, even after achieving income parity as teenagers. These early life disparities are notable because they indicate that girls have less opportunity to learn money management skills, and because they foreshadow many of the financial gender gaps that exist in adulthood.

Keywords: Gender pay gap, gender savings gap, income inequality, financial education