Early Career Setbacks and Women’s Career-Family Trade-Off

Itzik Fadlon, Frederik Plesner Lyngse and Torben Heien Nielsen
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Itzik Fadlon: University of California, San Diego and NBER
Frederik Plesner Lyngse: University of Copenhagen and CEBI
Torben Heien Nielsen: University of Copenhagen and CEBI

No 22-06, CEBI working paper series from University of Copenhagen. Department of Economics. The Center for Economic Behavior and Inequality (CEBI)

Abstract: We study how early career setbacks—in the form of worse initial job matches—have permanent labor and marriage market impacts differentially for males and females. We analyze the Danish physician labor market and exploit a randomized lottery that determines sorting into internships, which differ in the bundle of location and career opportunities they provide. Using administrative data for over fifteen years after the lottery experiment, we find that initial labor market sorting has important long-run effects on occupational choice and career trajectories for women only, which increases the gender earnings gap by 10-15 percent over the decades after graduation from medical school. We show that the differential gender sensitivity to setbacks is driven by women’s career-family trade-off, where women exhibit earlier and higher fertility and subsequently sort into more flexible but lower-paying jobs that facilitate their greater family responsibilities. Our findings have implications for policies aimed at gender equality, as they reveal how persistent gaps can arise even in settings with institutional equality of opportunity and they point to addressing family considerations and job flexibility as key channels.

Keywords: Economics of Gender; Human Capital; Occupational Choice; Fertility; Career versus Family Tradeoff; Early Career Sorting; Temporal Flexibility; Professionals (search for similar items in EconPapers)
JEL-codes: J13 J16 J24 R23 (search for similar items in EconPapers)
Pages: 83
Date: 2022-07-19
New Economics Papers: this item is included in nep-dem, nep-his and nep-lab
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