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Wages and family time allocation

This seminar will be delivered by Alex Theloudis (UCL), who will be presenting his job market paper 'Wages and family time allocation'. 

Abstract:

This paper examines the effects of wages and the gender wage gap on the allocation of married people's time across various activities. In the US, real wages of married men and women have grown steadily over the last three decades. The latter have outperformed the former and the gender wage gap has narrowed down favouring women. At the same time big changes have occurred in female labour supply and household work whereas men have barely changed the time they put into these activities.I develop a life-cycle collective model for individuals in a household (spouses) who differ in preferences and bargaining powers but share a common budget constraint. Individuals decide collectively about work in the market, work in the household, and leisure. Individual wages and the gender wage gap affect the family budget as well as intra-family bargaining power in the cross-section and over time due to lack of commitment. I estimate gender-specific preferences and the parameters of intra-family bargaining power using data on married and divorced individuals from the PSID. The narrowing gender gap improves women's bargaining power moderately and the effects of this improvement are concentrated around spousal work in the household. If women were paid their husband's wage, female full-time market work would increase by more than 32% even during the child bearing years; moreover the allocation of spousal time into household production would become more equal between men and women but the total household time input would decrease.