Female Earnings Inequality: The Changing Role of Family Characteristics and Its Effect on the Extensive and Intensive Margins

David Card and Dean Hyslop

Journal of Labor Economics, 2021, vol. 39, issue S1, S59 - S106

Abstract: Using data for three cohorts of women in the PSID, we show that annual earnings inequality fell sharply between the late 1960s and the mid-1990s, with a large decline in the component attributable to the extensive margin. We then fit earnings-generating models that incorporate both intensive- and extensive-margin dynamics to data for the three cohorts. Our models suggest that more than 80% of the decline in female earnings inequality can be attributed to a weakening of the link between family-based factors (i.e., children and the presence and incomes of partners) and the intensive and extensive margins of earnings determination.

Date: 2021
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