The Long-Run Effects of America’s First Paid Maternity Leave

Brenden Timpe , University of Michigan

This paper provides the first long-run evidence of the effect of a U.S. paid maternity leave policy on the labor market and the outcomes of children. I exploit variation in access to paid leave created by the interaction of long-standing differences in short-term disability insurance coverage and the state-level roll-out of laws banning discrimination against pregnant workers in the 1960s and 1970s. While the availability of these benefits sparked a substantial expansion of leave-taking by new mothers, it also came with a cost: I provide evidence that the enactment of paid leave led to shifts in labor supply and demand that decreased wages for women. In addition, the first generation of children born to mothers with access to maternity leave benefits saw a deterioration in educational attainment. These results have implications for our understanding of the effect of maternity leave policies on women's labor-market prospects and the well-being of children.

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 Presented in Session 130. Childhood Conditions and Adult Achievement