Does childcare matter for maternal labor supply?: Pushing the limits of the regression discontinuity framework

We use an extension of the RD approach based on a kindergarten enrollment cutoff date and a new resampling design to estimate the causal impact of subsidized childcare availability on Hungarian mothers' labor market participation around the 3rd birthday of the child. Besides standard fuzzy RD, which holds calendar time constant, we apply an alternative version where child's age is held constant, which enables us to (a) separate the childcare effect from other, age-specific effects, and (b) consider the effect of not only point, but interval cutoffs for eligibility. We combine RD with a difference-in-differences approach using a comparison group of mothers with children aged 4-5 to control for seasonal effects (parent selection, child development, within-year labor market fluctuations). Our estimates indicate that a mother with a 3 year old is 15% more likely to be active if her child is eligible for subsidized kindergarten, corresponding to previous estimates of labor supply elasticity of 0.3-0.75. This suggests that increased subsidized childcare availability and parental leave alone cannot explain the sharp increase in the rate of maternal participation seen around children's 3rd birthday, highlighting the importance of other factors such as separation preferences and flexible work forms

Jobbak a nők esélyei a közszférában?

A női dolgozók aránya jelentősen magasabb a közszférában, mint a magánszférában. Ennek számos oka lehet, köztük a munkahelyi jellemzők iránti eltérő preferenciák, illetve az is, hogy a nőket kevesebb diszkrimináció éri a közszférában, mivel a bértáblák és előléptetések szigorúbb szabályokon alapulnak. Ez a női-férfi bérkülönbségben és a nők vezetőségbeli magasabb arányában is megmutatkozhat, azonban a köz- és magánszféra közötti eltérés mértékéről nincs pontos becslés. A tanulmányban azt járjuk körül, hogy valóban kisebb-e a diszkrimináció, és ezáltal jobbak a nők esélyei a közszférában, vagy a szabályozottság ellenére a diszkrimináció más csatornákon keresztül itt is megnyilvánul. Az eredmények szerint a közszférában 7-8 százalékponttal kisebb, de szignifikáns a megmagyarázatlan bérkülönbség. A foglalkozási szegregáció a bérkülönbség kis részét magyarázza, és mindkét szektorban jelen van. A hasonló jellemzőjű nők a vezetői foglalkozások elérésében a magánszférában kismértékű hátrányt (körülbelül 2 százalékos) szenvednek a férfiakkal szemben, esélyeik egyenlőbbek a közszférában

Competition and the Gender Wage Gap: New Evidence from Linked Employer-Employee Data in Hungary, 1986-2003

The overall gender wage gap fell from .31 to .15 between 1986 and 2003 following the transition to a free market in Hungary. During the same time period, firms faced increased competition from both new domestic and foreign firms due to the rapid liberalization measures implemented by the government. Becker's (1957) model of employer taste discrimination implies that employers that discriminate against women may be forced out of the market by competition in the long run, leading to a fall in the gender wage gap. I test this implication using data from the Hungarian Wage and Earnings Survey covering 1986-2003. I estimate the effect of variation in various measures of product market competition, including trade variables, on the within-firm endowment-adjusted gender wage gap, making use of the fact that I am able to follow firms over time. The estimates show a significant negative relationship between product market competition and the within-firm gender wage gap

Jobbak a nők esélyei a közszférában?: a női-férfi bérkülönbség és a foglalkozási szegregáció vizsgálata a köz- és magánszférában

The share of female workers is significantly higher i the public than the private sector. This could be due to several reasons: different preferences towards job characteristics, or perhaps to lower discrimination against women in the public sector due to strict wage grids and hiring and promotional practices. Lower discrimination may manifest itself in the gender wage gap or in the higher ratio of women in management positions, however, there are no precise estimates available regarding the size of the differences in these measures between the two sectors. This study examines whether discrimination is smaller, and thus women's opportunities are better, in the public sector, or whether - despite the standardization of rules - discrimination appears through alternative channels. The results suggest that the public sector gender wage gap is significant, but 7-8% lower. Occupational segregation explains only a small part of the gap in both sectors. Women with equivalent observable characteristics suffer a small (2%) disadvantage in terms of the probability of reaching a management position in the private sector, while their chances appear to be more equal in the public sector

Vintage Effects, Ageing and Productivity

We provide new empirical evidence on the link between age and productivity using a transitional context. Building on a model of skill obsolescence, we assess the long-term adjustment process following a sudden change in skills needed in production that severely worsened older workers' labor market situation. The model implies that (a) the devaluation of skills should affect highly educated older workers more severely (b) the disadvantage should disappear over time as newer cohorts acquire more suitable human capital, and (c) the timing should differ among firm ownership types, reflecting the inflow of modern technologies and practices. Rather than focusing on wage differentials, we estimate the firm-level productive contribution of older relative to younger workers differentiated by education level. To assess long-run trends, we adapt the augmented production function methodology developed in international literature and apply it to a linked employer-employee dataset from Hungary covering from before (1986) to 20 years after (2008) the economic transition. The results suggest that - in line with the model - the within firm productivity differential between older and younger workers following the transition was largest among the highly skilled (-0.13 in 1996-2000). The fall in relative productivity followed the inflow of modern capital: the gap was largest in 1992-1995 in foreign-owned firms (-0.6), while it appeared later in domestic firms (-0.18 in 1996-2000) before disappearing by 2006. The magnitude and the negative effects of the adjustment period witnessed in Hungary highlight the importance of policies aimed at providing core competencies and adult training that enable older workers to adjust to sudden economic and technological changes

Can a fifty percent increase in public sector wages improve the position of public sector employees in the long run? An assessment of the public-private income gap in Hungary

We provide a detailed descriptive analysis of the long-term effects of the 50 percent public sector wage increase initiated by the government in 2002 in order to improve the relative situation of public sector workers. The aim of this policy was to attract high quality workers to the public sector, and to counteract the problem of "brain drain," the loss of high-skilled workers to abroad. To study the effects on the public-private income gap - and on high-skilled workers in particular - we employ empirical methods that allow us to take differences in the entire wage distribution (quantile regressions), workforce and firm composition (decomposition), as well as various potential biases (corrections for underreported wages and workplace characteristics) into account. Our results indicate that there is a large income premium in favor of the private sector at the higher end of the income distribution, especially once we account for worker and firm characteristics, which suggests that the same person earns substantially less in the public sector. This is especially pronounced for high-skilled workers. The 50 percent increase initially improved the relative income of public sector workers, but in the longer run, income gaps returned to close to the pre-reform level and the distributional differences remained

Are children driving the gender wage gap? Comparative evidence from Poland and Hungary

We examine how much children and responsibilities related with them contribute towards the divergence of mens and womens wages, and consequently, to the formation of the gender wage gap. To derive the relative contribution of gender specific wage inequalities caused by the parenthood to the overall gender wage gap, we provide a modification of standard Oaxaca-Blinder decomposition method, and correct simultaneously for selection into work and parenthood. Contrary to our expectations, the findings show that most of the gender wage inequality is due to the positive wage gap between men who do and do not have children and not due to the wage penalty incurred by mothers

Who Earns Their Keep? An Estimation of the Productivity-Wage Gap in Hungary 1986-2005

In this paper we seek to provide new empirical evidence on the relative productivities and wages of various worker groups (by gender, age, and education), based on longitudinal matched employer-employee data from Hungary covering 1986-2005. We estimate the productivity and wage gaps from firm-level production functions and wage equations, using firm-level data on productive inputs and output, wage costs, and the demographic composition of the work force obtained from the linked worker data. This methodology allows us to assess whether productive differences can account for the wage gaps between worker groups, as well as the evolution of these gaps following the transition to a free market. We take firm fixed effects into account to assess the role of selection at the firm level, and estimate the production function via the method of Levinson and Petrin to account for endogeneity of input choice. The results show that while there may be significant differences in productivities and wages between groups in the OLS specification, these mostly become insignificant within firms. We find that much of the fall in the value of skills obtained prior to the transition is due to selection of workers at the firm level