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Title: The Service Sector and Female Market Work: Europe vs. US

Citation Type: Miscellaneous

Publication Year: 2011

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Abstract: Aggregate labor market hours differ dramatically across OECD countries. However, differences in hours worked by gender do not necessarily match aggregate market hour differences. Continental Europe has experienced a smaller rise in formal female employment compared with the United States or Scandinavia. Additionally, Continental Europe has a substantially smaller service sector. These facts coincide with job requirements shifting from physical strength to intellectual abilities. This paper gives empirical evidence on why women predominately work in the service sector. Given the empirical evidence, a model is developed where technical change favoring women drives female employment through the growth of the service sector.The key is households can produce a substitute for market services and women are, on average, less productive in sectors requiring more brawn, giving them a comparative advantage with respect to staying home and working in the service sector. Therefore, an economy that imposes high taxes does not facilitate the movement of women into the labor market causing service production to remain at home. This reduces the demand for market services, which feeds back into low total hours worked by women (and the total economy). Subsidies to female employment can circumvent the high tax effect, but will lead to welfare loses.

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Authors: Rendall, Michelle

Publisher: The University of Zurich

Data Collections: IPUMS USA, IPUMS CPS

Topics: Gender, Labor Force and Occupational Structure

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