The Benefits and Costs of Paid Family Leave

Buyi Wang, Meredith Slopen, Irwin Garfinkel, Elizabeth Ananat, Sophie M. Collyer, Robert Hartley, Anastasia Koutavas and Christopher Wimer

No 33279, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: National paid family leave programs have been repeatedly proposed in the United States in recent years. To inform policy discussions, we provide a benefit-cost analysis of introducing such a program. We systematically identify high-quality, quasi-experimental studies on the impact of paid leave on infants and parents. Using the most conservative estimates or the mean estimates from this literature, we estimate that every $1,000 investment in paid parental leave would generate, respectively, $7,275 or $29,406 in present discounted net social benefits. We use these estimates to conduct a microsimulation of benefits and costs of two policy proposals with different eligibility and wage replacement rates. The first, a 4-week program, would have an initial fiscal cost of under $2 billion and net social benefits of $13 (conservative) or $55 billion (mean). The corresponding figures for the 12-week program are about 3.7 times larger, suggesting that either version would likely generate high returns.

JEL-codes: I18 J18 (search for similar items in EconPapers)
Date: 2024-12
New Economics Papers: this item is included in nep-dem, nep-hea and nep-lab
Note: CH
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