Paula Calvo, Arizona State University
“The Welfare Impact of Motherhood”
Abstract
Motherhood profoundly reshapes women’s employment and earnings, but how does it impact mothers’ welfare? We examine this by combining longitudinal Japanese household panel data with a dynamic equilibrium model of marriage, fertility, divorce, and intrahousehold bargaining.
Event studies around the birth of the first child show large, persistent declines not only in mothers’ employment and earnings, but also in several welfare-relevant dimensions: mothers’ private consumption and leisure fall while child-related spending and home production rise. Our core contribution is to identify the mechanisms behind these patterns. The same employment penalty has sharply different welfare and policy implications depending on whether it reflects efficient specialization or preferences for child-related public goods, versus childcare scarcity, gender norms, or mistaken beliefs about invisible parenting costs. We show that all these channels are empirically relevant. Using our equilibrium model, we aim to quantify how these mechanisms impact mothers’ welfare. To do so we compute decision and experienced utility from having a child. Using these measures, we aim to evaluate policies by whether they raise welfare and fertility—not only by whether they reduce labor market motherhood penalties.
Event studies around the birth of the first child show large, persistent declines not only in mothers’ employment and earnings, but also in several welfare-relevant dimensions: mothers’ private consumption and leisure fall while child-related spending and home production rise. Our core contribution is to identify the mechanisms behind these patterns. The same employment penalty has sharply different welfare and policy implications depending on whether it reflects efficient specialization or preferences for child-related public goods, versus childcare scarcity, gender norms, or mistaken beliefs about invisible parenting costs. We show that all these channels are empirically relevant. Using our equilibrium model, we aim to quantify how these mechanisms impact mothers’ welfare. To do so we compute decision and experienced utility from having a child. Using these measures, we aim to evaluate policies by whether they raise welfare and fertility—not only by whether they reduce labor market motherhood penalties.
Paula Calvo is an Assistant Professor in Economics at Arizona State University. She completed her Ph.D. in Economics at Yale University in May 2022. Her current research investigates the interplay between family structures and labor market outcomes, with a focus on gender gaps and children outcomes.
She also worked as a consultant for The World Bank and the UNCTAD, in projects related to gender, inequality, and the role of trade restrictions on the welfare of households.
You can read more about Paula Calvo here
CEBI contact: Thomas Høgholm Jørgensen