Policy Generosity, Employer Heterogeneity, and Women’s Employment Opportunities: The Welfare State Paradox Reexamined

Abstract

Scholars of comparative family policy research have raised concerns about potential negative outcomes of generous family policies, an issue known as the “welfare state paradox.” They suspect that such policies will make employers reluctant to hire or promote women into high-authority jobs, because women are more likely than men to use those policies and take time off. Few studies, however, have directly tested this employer-side mechanism. In this article, we argue that due to employer heterogeneity, as well as different modes of policy intervention such as mandate-based and incentive-based approaches, generous family policies may not always lead to employer discrimination. Adopting a quasi-experimental research design that classifies employers based on their differential receptivity to family policy changes, we compare their hiring and promotion of women before and after two major family policy reforms in Japan, one in 1992 and another in 2005. Our analysis using panel data of large Japanese firms finds little evidence of policy-induced discrimination against women. Instead, we find that employers who voluntarily provided generous leave benefits prior to government mandates or incentives actually hired and promoted more women after the legal changes, and employers who provided generous benefits in response to government incentives also increased opportunities for women.

The Right to Work, Power Resources, and Economic Inequality

“…Yet sociologists and economists have highlighted the critical importance of within-and between-firm processes for inequality trends (Tomaskovic-Devey and Avent-Holt 2019). For example, several scholars examine firm-level data to understand how labor unions affect work conditions and pay distribution (Shin 2014, Jung 2016, while Mun and Jung (2018) assess the influence of policy change at the firm level regarding maternity leave in Japan. Similarly, Wilmers (2018) has demonstrated the need to examine between-firm power relationships to fully understand wage inequality, and he also develops a promising method to examine the contemporary firm-level influence of unions on wage attainment and dispersion (Wilmers 2017).…”

Estimating Treatment Heterogeneity of International Monetary Fund Programs on Child Poverty with Generalized Random Forest

“…Political pathways: Institutions, polity, politics and public policy moderate responses to economic turmoil. Public policy can offset the increased risk that parents become unemployed following economic shocks (Mun and Jung 2018). Such policies also reduce the likelihood of material deprivation for children in the short-term.…”

Work–family reconciliation policies and women’s and mothers’ labor market outcomes in rich democracies

“…Plausibly, the implementation and consequences of country-level work-family policies vary across organizations, and organizational heterogeneities could partially explain the lack of robust results (Mun and Jung 2018). Hence, much could be learned with a three-level data structure of individuals nested within firms within countries.…”

“…An extensive literature beyond these seminal works has fueled the debate on paradoxes and tradeoffs (Bergmann 2009;Dieckhoff et al 2015;Kluve and Tamm 2013;Lalive and Zweimueller 2009;Morgan and Zippel 2003;Mun and Jung 2018;Nieuwenhuis et al 2017;Ziefle and Gangl 2015). For brevity, we review only a sample.…”

“…While the cross-national literature has mainly been cross-sectional, several case studies of individual countries exploit over-time change in work-family policies (Lalive and Zweimueller 2009;Mun and Jung 2018;Petersen et al 2010Petersen et al , 2014Schober 2014;Schoenberg and Ludsteck 2014). For example, Gangl and Ziefle (2015) used difference-in-difference models to compare German mothers' subjective preferences immediately before and after work-family policy reforms.…”