The effect of housework on wages in Sweden
Abstract: The purpose of this thesis is to examine the effect of housework on wages for women and men in Sweden using both linear and non-linear specifications of the effect. Furthermore, we investigate the effort and selection hypotheses, i.e. whether the effect of housework on wages can be explained by reduced effort and/or selection into jobs which are more compatible with housework. Three methods are applied: OLS, IV regressions and propensity score matching. The latter two methods are used in attempt to reduce potential endogeneity of housework. We find weak support for the effort and selection hypotheses but there is a statistically significant wage penalty for women in the linear specification, while the effect for men is less pronounced. However, in the upper part of the housework scale, which is captured in the non-linear specification, the result is somewhat reversed in that performing housework 18 hours or more per week penalise the wages of men more than those of women. We discuss our results in relation to potential endogeneity of housework, which is an important, although often neglected, issue throughout previous literature on the subject.
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