Does Having Children Hurt Women Financially? An Economics Perspective

Recently, Twitter was buzzing because a doctor tweeted about the negative effects of breastfeeding on mothers.

The thread immediately went viral, with many pro-breastfeeding advocates objecting. Some netizens took a neutral stance, saying facts are facts and there’s no need to get emotional about them. Others made counter-threads, like this one:

Following that thread was fun because it was full of references. Unfortunately, the debate wasn’t truly two-sided and practically ended there, as far as I could tell.

Although I don’t know much about breastfeeding, the debate caught my attention. I agree with the doctor that raising a child is an activity that demands considerable attention, time, and cost, and in my view, the burden falls disproportionately on women. The nausea, carrying the baby for 9 months, and then risking your life during delivery. After birth, breast milk can only be produced by the mother, not to mention the bodily changes. I don’t know what it feels like, but if I had to go through all that, I’d probably pass.

This disparity doesn’t stop at biology – it extends to finances. We’re fortunate to live in more progressive times, where the gender pay gap has been narrowing. According to Kleven et al. (pdf), the gender pay gap has long been shrinking thanks to education and anti-gender discrimination measures, but the gap hasn’t disappeared completely. In fact, the pay gap between men and women plateaus at around 15-20%. Kleven et al. offer an explanation: the cause is children. At least in Denmark.

Kleven et al. conducted their study on Danish residents from 1980 to 2013. Their study is essentially a Diff-in-Diff design, where the control group is couples who don’t (yet) have children. Their robustness check uses placebo births and IV with twin births and gender mix as instruments. The methodology is quite interesting, made possible by Denmark’s rich population data. Their dependent variables are wage rate, labor participation, and working hours.

But in this blog post I’ll only discuss their results.

According to them, in Denmark, men’s and women’s wages follow the same trend and don’t differ when education is controlled for. However, when having their first child, men’s wages continue to rise steadily while women’s wages stagnate or even decline. This occurs across all three of their wage indicators. They also note that non-child causes have diminished greatly, while the child-related cause has actually risen, resulting in the persistent 20% gap.

I’ll quote what they consider their two most important conclusions:

First, the inclusion of education controls has only a small impact on the estimation of child-related gender inequality. It is still the case that child-related inequality is close to 80% of total inequality at the end of the period…

…Second, while the child-related gender gap has been growing over time, the education-related gender gap has been shrinking dramatically. Education related inequality was almost as large as child-related inequality at the beginning of the period, but has almost disappeared over time.

…the point being that education is no longer a major cause of the income gap between men and women and has nearly disappeared. Meanwhile, the child effect (technically they call it “child penalty”) continues to rise over time.

Remember that this is a study about Denmark. As we know, Denmark is one of the most aggressive countries in promoting gender equal pay and gender equal opportunity. Even regarding children, things like parental leave and government support are already very family-friendly. Yet the gap persists, and it seems genuinely difficult to eliminate entirely.

For non-Denmark contexts, there’s Hupkau and Leturcq (2017) who studied the UK. I’ve also seen a study from a Balkan country but can’t remember who wrote it. There’s also a report from the U.S. Census Bureau that reaches the same conclusion. Kleven et al. include a chart of international gender pay gaps, which more or less are indeed stuck at around 20 percent. It’s in their paper if you want to see it.

Having children does seem to burden women more than men. This is true even for pay, even in very progressive countries where the government is truly active on the gender pay gap issue. How much more so in countries where the government doesn’t bother.

This post is not meant to tell women to stop having children, let alone suggest that breastfeeding is a scheme by men to earn higher wages. Having and raising children is every woman’s right. Even though having children is demanding and resource-intensive, the happiness children bring to their parents may well be worth it. There is certainly nothing wrong with women (and men) having more information about what to consider when making a decision as important as having children. This decision is enormous and has significant long-term effects, both for individuals and society.

I also encourage husbands to recognize the enormous sacrifice their wives make when choosing to have children. Help her carry that burden. If she has cravings, buy her what she wants. Take on more of the non-biological responsibilities than you did before she was pregnant. Take turns watching the baby, handling diapers, and so on. Remember, men cannot replace pregnancy or breastfeeding, so at least compensate in other areas.

For men who abandon women after getting them pregnant: go to fucking hell