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Peer effects in parental leave decisions

Clara Welteke and Katharina Wrohlich

Labour Economics, 2019, vol. 57, issue C, 146-163

Abstract: We analyze whether mothers’ parental leave decisions depend on their coworkers’ decisions. The identification of peer effects bears various challenges due to correlated characteristics within social groups. We therefore exploit quasi-random variation in the costs of parental leave induced by a policy reform in Germany. The reform encourages mothers to remain at home during the first year following childbirth. Administrative linked employer-employee data enable us to assign a peer group to individuals who work in the same establishment and occupation. Our results suggest that parental leave decisions are significantly influenced by coworkers’ decisions.

Keywords: Peer effects; Social interaction; Labor supply; Family policy (search for similar items in EconPapers)
JEL-codes: C31 J22 D04 (search for similar items in EconPapers)
Date: 2019
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