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Author: Youderian, Xiaoyan Chen
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Youderian, Xiaoyan Chen |
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Three Essays on Human Capital Ph.D. Dissertation, Kansas State University, 2012 Cohort(s): NLSY97 Publisher: ProQuest Dissertations & Theses (PQDT) Keyword(s): Human Capital; Maternal Employment; Modeling, Fixed Effects; Modeling, OLS; Wage Gap; Wage Penalty/Career Penalty Permission to reprint the abstract has not been received from the publisher. The third essay is on the motherhood wage penalty. There is substantial evidence that women with children bear a wage penalty of 5 to 10 percent due to their motherhood status. This wage gap is usually estimated by comparing the wages of working mothers to childless women after controlling for human capital and individual characteristics. This method runs into the problem of selection bias by excluding non-working women. This paper addresses the issue in two ways. First, I develop a simple model of fertility and labor participation decisions to examine the relationships among fertility, employment, and wages. The model implies that mothers face different reservation wages due to variance in preference over child care, while non-mothers face the same reservation wage. Thus, a mother with a relatively high wage may choose not to work because of her strong preference for time with children. In contrast, a childless woman who is not working must face a relatively low wage. For this reason, empirical analysis that focuses only on employed women may result in a biased estimate of the motherhood wage penalty. Second, to test the predictions of the model, I use 2004-2009 data from the 1997 National Longitudinal Survey of Youth (NLSY97) and include non-working women in the two-stage Heckman selection model. The empirical results from OLS and the fixed effects model are consistent with the findings in previous studies. However, the child penalty becomes smaller and insignificant after non-working women are included. It implies that the observed wage gap in the labor market appears to overstate the child wage penalty due to the sample selection bias. |
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Bibliography Citation
Youderian, Xiaoyan Chen. Three Essays on Human Capital. Ph.D. Dissertation, Kansas State University, 2012. |