Cluster-Seminar Public Finances and Living Conditions

Gender gaps in employment have narrowed but remain substantial, especially within couples. When I proxy potential earnings through demand-driven wage changes in job tasks within industries and using German administrative data, I show that a rising relative female-to-male potential wage increases work hours of female partners, but at a diminishing rate. Men, on the other hand, reduce their work hours, but only at low levels of the relative wage. In sum, this means that the within-couple gap in work hours widens significantly as the earnings prospects of women relative to men improve. I then discuss potential drivers for these puzzling results and focus on economic incentives of Becker’s household model, comparative advantages and gender identity norms.