Same-Sex Couples and the Child Earnings Penalty

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Working Paper Number: CES-23-25

Abstract

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Existing work has shown that the entry of a child into a household results in a large and sustained increase in the earnings gap between male and female partners in opposite-sex couples. Potential reasons for this include work-life preferences, comparative advantage over earnings, and gender norms. We expand this analysis of the child penalty to examine earnings of individuals in same-sex couples in the U.S. around the time their first child enters the household. Using linked survey and administrative data and event-study methodology, we confirm earlier work finding a child penalty for women in opposite-sex couples. We find this is true even when the female partner is the primary earner pre-parenthood, lending support to the importance of gender norms in opposite-sex couples. By contrast, in both female and male same-sex couples, earnings changes associated with child entry differ by the relative pre-parenthood earnings of the partners: secondary earners see an increase in earnings, while on average the earnings of primary and equal earners remain relatively constant. While this finding seems supportive of a norm related to equality within same-sex couples, transition analysis suggests a more complicated story.

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