This is how parental leave policies impact the gender gap

Sep 6, 2019

Women in high heels walk at a business district in Tokyo, Japan, June 4, 2019. REUTERS/Kim Kyung-Hoon - RC19E3187290

Labour market institutions and corporate environments makes it difficult to stay employed during pregnancy. Image: REUTERS/Kim Kyung-Hoon

Yukiko Asai

Postdoctoral Researcher, University of Chicago

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The social insurance system defined as the rate in 2000. The x-axis denotes months around the childbirth, and the y-axis represents the social insurance rate. The area marked in grey is the maternity leave period, which is from 1.5 months before birth and to two months after birth. Mothers are eligible for parental leave until the end of the 11th month after birth. The health insurance rate was 8.5%, and pension insurance was 17.35% in 2000, and employers were responsible for half the insurance cost during leave, i.e. 12.925%. Image: Author

risk{f,a(i)} denotes the probability that a working woman eligible for leave has a child and thus goes on leave, where the subscript f indicates that risk varies across men and women (specifically, risk of leave is 0 for men), and the subscript a(i) indicates that it varies across women only based on their ages. Costt denotes the employment costs of leave to the firm, where t indicates time. Image: Author

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