State-Provided Paid Family Leave and the Gender Wage Gap

• Main Author: Abrams Widdicombe, Aimee Samantha
• Format: Others
• Published: Scholarship @ Claremont 2016
• Subjects: gender wage gap; economics; paid family leave; family leave; maternity leave; paternity leave; Econometrics; Economic History; Economic Theory; Health Economics; Macroeconomics; Other Economics; Political Economy; Public Economics; Regional Economics
• Online Access: http://scholarship.claremont.edu/scripps_theses/792; http://scholarship.claremont.edu/scripps_theses/883

The U.S. is the only OECD country that does not offer any form of federal paid parental leave. Only three states—California, New Jersey and Rhode Island—have state paid parental leave policies; implemented in 2004, 2009 and 2014, respectively. Through descriptive statistics and a regression analysis of women and men’s wages in those three states, before and after the implementation of the policies, we assess the effects of paid leave programs on the gender wage gaps in those states. Our results show us that California’s paid family leave policy had greater effects on decreasing the gender wage gap than the policies in New Jersey and Rhode Island. In addition, our regression analysis shows us that women of childbearing age (19-45 years) saw an increase in their wages after the policy implementations, while men of childbearing age saw a decrease in their wages. This led us to the conclusion that paid family leave policies may be effective in decreasing the gender wage gap; however it is problematic that men’s wages decreased, implying that the policies may not be totally welfare optimizing. However, we came to an important conclusion that will hopefully entice more states and the federal government to implement policies to better support working parents.