The Motherhood Wage Penalty: Sorting Versus Differential Pay


 The Motherhood Wage Penalty: Sorting Versus Differential Pay

By Trond Petersen, University of California, Berkeley and University of Oslo Andrew Penner, University of California, Berkeley, Geir Høgsnes, University of Oslo

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e motherhood wage penalty is today probably the largest obstacle to progress
in gender equality at work. Using matched employer-employee data from Norway
(1980–97), a country with public policies that promote combining family and career,
we investigate (a) whether the penalty arises from differential pay by employers or
from sorting of employees on occupations and establishments, and (b) changes in the
penalties over time in a period with major changes in family policies. The findings
are as follows. (1) There are major wage penalties to motherhood, but these declined
strongly over the 18–year period, likely caused by changes in family policies and
in how families operate. (2) The penalty to motherhood is mostly due to sorting
on occupations and occupation-establishment units. By 1995–97, mothers and nonmothers
working in the same occupation-establishment unit were paid same wages.
(3) Women who become mothers are wage wise positively selected, but the premia
are wiped out by the negative effects of actual motherhood. (4) For wage growth,
there were premia to motherhood in 1980–89, but none by 1990–97. In conclusion,
the motherhood penalty is not due to employers paying mothers lower wages and its
size appears sensitive to changes in family policies, with large reductions in penalties
over time.

By Matthew Whiting
Published Oct. 10, 2010 11:19 AM - Last modified Oct. 15, 2010 8:54 AM