The Effect of Motherhood on Wages and Wage Growth: Evidence for Australia

Tanya Livermore, Peter Siminski and Joan Rodgers
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Tanya Livermore: University of Wollongong, http://www.uow.edu.au/index.html

Economics Working Papers from School of Economics, University of Wollongong, NSW, Australia

Abstract: Labour market theory provides several reasons why mothers are likely to earn lower hourly wages than non-mothers. However, the size of any motherhood penalty is an empirical matter and the evidence for Australia is limited. This paper examines the effect of motherhood on Australian women’s wages and wage growth using a series of panel-data models which control for other relevant factors, both observed and unobserved. Using data from the Household, Income and Labour Dynamics in Australia (HILDA) survey, an unexplained motherhood wage penalty of around four per cent for one child, and eight per cent for two or more children, is found. Further analysis suggests that the wage penalty emerges over time through reduced wage growth, rather than through an immediate wage decline after the birth of a child. This reduction in wage growth is consistent with discrimination but also with a reduction in mothers’ work effort.

Keywords: Motherhood Wage Penalty; Wage Growth; Fixed Effects (search for similar items in EconPapers)
JEL-codes: C33 J13 J31 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2010
New Economics Papers: this item is included in nep-lab
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: The Effect of Motherhood on Wages and Wage Growth: Evidence for Australia (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:uow:depec1:wp10-12

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