Child Penalties across Countries: Evidence and Explanations

Kleven and colleagues compare earnings in Denmark, Sweden, Austria, Germany, the United Kingdom and the United States. Their event studies align time around the birth of a first child and adjust for age and calendar-time trends. The countries contribute different sources of data, which matters when comparing the resulting estimates.

Which parts of earnings change?

Mothers’ earnings generally fall after a first birth in the countries studied, while long-run changes for fathers are much smaller. The size and timing of the gap vary. Some people who stay in work may reduce their hours or move to differently paid jobs. Employment alone can therefore miss an important part of the earnings change.

The authors average years five through ten after first birth to describe the long-run gap. In the appendix, employment gaps are appreciably smaller than earnings gaps in the Scandinavian and German-speaking countries studied. The two measures are closer in the United Kingdom and United States. Long-run estimates also include the consequences of subsequent births where they occur. The first birth sets the clock for the comparison.

The international comparison raises hypotheses about childcare provision, parental leave and gender norms. It does not isolate the causal contribution of each factor. The estimates also have a specific starting event, population and measure of earnings, which should remain visible in comparisons.

The same figure can tell two stories about time

Start with Denmark and Sweden in Figure 1. Sweden shows a much larger short-run drop for women after the first birth, but the difference narrows considerably over the longer interval. Looking only at long-run averages hides different experiences in the early years. Looking just after birth can make temporarily leaving work look like permanent exclusion. The authors retain zero earnings observations. A fall can therefore reflect non-employment, changes in hours for people who remain employed, or changes in pay. Establish who and what is counted before interpreting the curve.

In Figure 2, the initial changes are less pronounced in the United Kingdom and the United States, and the gap grows over time. This distinct trajectory raises separate policy questions. One is whether parents can take protected time away from work. Another is what lets them maintain hours and accumulate experience after returning. Both can influence earnings, but at different points. The comparison makes those questions easier to ask. Identifying actual effects still requires evidence on when a policy changed and who was able to use it.

Getting a Job: Is There a Motherhood Penalty? examines evaluation in hiring. The cross-country study follows earnings after parenthood, making the two a useful pair for distinguishing recruitment decisions from changes accumulated over a career.

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