Abstract
We study several key aspects of the design of parental leave systems. First, we estimate parents’ willingness to pay for parental leave using Danish administrative data on the division of leave from almost 190,000 births combined with sharp variation in economic incentives created by the parental leave benefit system. We find evidence of both strong behavioral responses with significant bunching at kink points and a willingness to pay for a gender-traditional allocation of leave, where fathers take little or no leave. Second, we provide a menu of counterfactual policy simulations showing substantial interaction effects between earmarked leave, replacement rates and the duration of leave benefits. Relevant for the implementation of a recent EU directive, a higher replacement rate significantly increases the behavioral response of fathers to earmarked leave. Finally, we discuss the welfare effects of different policies aimed at increasing the parental leave of fathers.
| Originalsprog | Engelsk |
|---|---|
| Artikelnummer | 105202 |
| Tidsskrift | Journal of Public Economics |
| Vol/bind | 238 |
| Antal sider | 19 |
| ISSN | 0047-2727 |
| DOI | |
| Status | Udgivet - 2024 |
Bibliografisk note
Funding Information:We thank Claus Thustrup Kreiner and Frederik Lyngse along with seminar participants at CEBI, Oxford, Aarhus, SEHO 2022, Lund, Helsinki GSE, and Stockholm University for valuable comments and suggestions. We gratefully acknowledge support from the Center for Economic Behavior and Inequality (CEBI) at the University of Copenhagen, financed by grant #DNRF134 from the Danish National Research Foundation. S\u00F8gaard also acknowledges support from the European Union Marie Sk\u0142odowska-Curie Fellowship #841969, and J\u00F8rgensen acknowledges support from Carlsberg Foundation grant #CF22-0317.
Publisher Copyright:
© 2024 The Author(s)