Work, family, & policy in a time of rising gender equality - PowerPoint PPT Presentation

Work, family, & policy in a time of rising gender equality Betsey Stevenson University of Michigan CEPR, CESifo, and NBER

Roadmap  Examine how gender roles and families have changed over time  Turn to economics to help us understand these changes  Explore the role of policy, technological, and trade changes in the second half of the 20th century on families  Highlight the challenges that people face today  Take a brief look at how the economics profession has fallen behind in describing the world

A Golden Age for Golden Marriage Source: U.S. Censuses of Population, 1880 – 2014. American Community Survey, 2014

Fertility Delays

Divergence in Births

Fertility Delays

A Similar Pattern in Canada

Women Education Ascendance  Young women are choosing higher education at much higher rates and outperforming boys in the classroom  Nearly three quarters of girls graduating high school go straight to college at either a 2- or 4-year school.  Male high school graduates are 10 percentage points less likely to do so.  There were 137 female graduate students for every 100 male graduate students in 2017.  Women earned 53 percent of all doctorate degrees in 2017, compared to roughly 10 percent in 1970.  70% of doctoral degrees in health and medicine  61% of doctoral degrees in social and behavioral sciences  23% of doctoral degrees in engineering  25% of doctoral degrees in mathematics and computer science

Among young people: women hold more degrees Source: Current Population Survey, ASEC

The gender gap in median job tenure has closed Source: Current Population Survey, ASEC

Women’s share of household income has grown Source: Current Population Survey, ASEC

More wives are out-earning their husbands. Percent of wives who earn more than their husbands 40 38 36 34 32 30 28 26 24 22 1987 1990 1993 1996 1999 2002 2005 2008 2011 2014 Source: U.S. Bureau of Labor Statistics, 1988 – 2015 Annual Social and Economic Supplements to the Current Population Survey (CPS).

Earnings are rising most for college-educated Source: U.S. Current Population Survey, ASEC

Our times have a changed  Women hold 49 percent of the jobs  Women’s equality in the labor force has meant:  more work  higher earnings  shifting to new occupations, previously male- dominated occupations  less part-time work  more moms at work  more dads at home

Economic Growth  The growth in women’s paid work was responsible for about a fifth of the growth in real GDP in the 1970s and 1980s  Much of the growth in household income in the 1980s and 1990s was driven by rising female wages  The focus on stagnant wages arose as women’s labor force participation growth stalled  U.S. female labor force participation has declined, while it continues to rise internationally

Female Labor Force Participation Is Rising Internationally 80 75 70 65 60 55 50 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Australia Canada France Germany Japan United Kingdom United States

What caused all these changes? What insight does economics give us to these changes?

Why marry?  Production complementarities  Through specialization, households can produce more together than the singles can produce apart While anyone can specialize in household production, perhaps because of their role in childbirth, women have typically had a comparative advantage in home production  Public goods  My watching the television with you doesn’t diminish your experience watching television  Children can be thought of as a public good to the extent that one person’s love or pleasure in their children does not crowd out the other person’s  Consumption complementarities  I may enjoy television more if you are watching it with me  I may enjoy our children more if I can share that joy with you  Comes from the pleasure of consuming together

Old Model of Marriage: Specialization between home and work

Why marry? Production complementarities  One person specializes in earning income to purchase items in the market  The other person specializes in home production  The key to specialization: there are benefits to having one person do it all, rather than split the job among two people. That means that one person who specializes in laundry can do more laundry in an hour, than two people each spending 30 minutes would do. One person focusing on cooking, childrearing, laundry, allows all of those tasks to be done better and more efficiently. Being more dedicated to work increases the chance of a raise or promotion, so that one person working 60 hours a week can earn more than two people each working 30 hours a week.  Returns to specialization exist!  But they vary according to task, over time, and may not exist in such broad categories as “market work” versus “home work”

Three important changes 1. Policy/Legal 2. Technology 3. Trade

What changed?  Laws directly related to employment increased women’s options to work outside the home  Other laws change the incentives and returns to working outside the home: Unintended consequences of many policy changes  Many changes, some highlights:  Equal Pay Act of 1963  Title VII of the Civil Rights Act of 1964  Title IX of the Educational Amendments to the Civil Rights Act  Divorce laws changed the nature of bargaining within families,  Supreme Court decisions give all women the right to access birth control, the right to seek an abortion, and legal rights to children born out of wedlock

How Did Legal Changes Impact the Growth?  Laws directly related to employment increased women’s options to work outside the home  Other laws change the incentives and returns to working outside the home  Title IX’s applicability to Sports Gave women equal access to participating in sports Caused women’s sports participation to rise Sports increase education, led women to enter male- dominated occupations, and increased labor force participation  Divorce Law Reform Does not change divorce per se, but does change the amount of time women are likely to spend in marriage Shifts bargaining so that options outside of marriage are more important Increased women’s labor force participation

What changed  Technological developments Development of appliances that substitute for skill in the home (e.g. washing machines, dishwashers) Improved birth control such as the birth control pill increased control over fertility New packing techniques reduced the cost of preparing and distributing pre-made foods Mass production reduced costs of creating goods like clothes, food by factories  Increased trade Reduced the cost of goods that were substitutes for home production Increased productivity in market work

Societal changes changed the benefits of marriage  Taken together changes decreased the potential for production efficiencies in marriage  The benefit of specialization between market and non-market work fell  The increased availability of substitutes for home production and the decrease in the cost of substitutes decreased the benefits  Technology substituted capital for skilled labor in the home reducing the returns to domestic work  The (opportunity) cost of specialization into non-market work rose  Women’s opportunities outside the home rose  Women’s better access to education and birth control increased the returns to investing in market skills  Divorce law changes increased the incentives for women to invest in their options outside their marriage

Changes  Less work in the home, particularly by women  Between 1965 and 2003 home production by women fell between 11 and 12 hours a week on average, while home production by men rose by 4.5 hours (Ramey 2007) (Aguiar and Hurst 2007).  More market work by women, even those with young kids  In 1970, among women with children under the age of 5, the majority, 70%, were out of the labor force, presumably full-time homemakers. In the ensuing decades, labor market participation became the norm for mothers with young children and only 36% were out of the labor force in 2006.  Decline in marriage  But declines in marriage could have been bigger!

Shift in importance among the three benefits A shift away from the benefits of production-based marriage to consumption-based marriage.  Increase in the benefits of shared public goods within marriage  Increase in consumption complementarities within marriage  Increase in marriages of “equal” partners, sharing production inside and outside the home  Specialization becomes more narrow or non-existent Narrow: Managing children’s doctors appointments, household paperwork, finances, math homework, managing home technology Non-existent: Few returns to specializing in loading the dishwasher

New model of marriage