Association for Public Policy Analysis & Management

It is well established that children differentially impact the wages of mothers and fathers: women incur a wage penalty for motherhood, while men garner a wage premium for fatherhood. Prior work finds that for both men and women the largest penalties and premiums associated with parenthood tend to be found among highly educated workers in professional/managerial occupations. However, while the majority of research on motherhood penalties and fatherhood premiums investigates how individual men and women’s earnings change after the arrival of children among different groups of workers, it remains unclear how parental bonuses and penalties align within couples across households by educational attainment and occupational status. Moreover, studies investigating child effects on individuals’ wages draw on theoretical explanations that rely on the joint decision-making of couples, yet little work to date directly situates the effects of children on earnings within couples and in the larger context of US earnings inequality. This project uses dyadic multi-level models on the 1980-2012 waves of the National Longitudinal Survey of Youth (NLSY79) to investigate the distribution of child wage effects within married, opposite-sex couples by educational attainment and professional/managerial status. Using couples as the unit of analysis better aligns examination of parental penalties and premiums with existing theories explaining the reproduction of gender inequality within and across households. Results indicate that wage effects associated with family composition not only shape the gender wage gap within households, but also contributes to wage inequality among families based on the differential distribution of child wage effects within families across class. Furthermore, the gender wage gaps associated with children within married couples are amplified among the most privileged families, suggesting that the gender wage inequality found within highly educated, professional/managerial couples can be potentially described as a “price of privilege” paid by couples with more economic resources. Findings suggest that to better address the stalled decline in the gender pay gap as well as wider U.S. wage inequality, it is necessary for researchers and policy makers to consider how within-couple wage gaps associated with children vary across households by social class.