Nieuwenhuis, Rense Need, Ariana van der Kolk, Henk
Year of Publication:
LIS Working Paper Series 599
This paper examines to what extent family policies have affected earnings inequality within and between coupled households. Previous studies had found cross-country variation in the degree to which women's earnings attenuate earnings inequality between households. In this paper we explain this variation with reconciliation policies and financial support policies. We used person-level data from the Luxembourg Income Study (LIS, 2013) on 572,222 coupled households, covering the period from 1981 to 2005 in 18 OECD countries. These data were combined with country-level data from the Comparative Maternity, Parental, and Childcare Database (Gauthier, 2010). In countries with extensive reconciliation policies women contributed a larger share of total household earnings, and earnings inequality among women was relatively low. In societies with extensive financial support policies, women contributed a smaller share to total household earnings, and inequality among the earnings of women was relatively high. Women's earnings were found to attenuate inequality between households to a larger extent in countries with extensive reconciliation policies and limited financial support policies. Countries with family policy arrangements that facilitate women's employment and consequently smaller earnings inequalities within households also contribute to smaller inequalities between households.