Gender identity and relative income within household: Evidence from China

TL;DR

This study examines how traditional gender norms in China influence married women's labor outcomes, revealing that women tend to reduce earnings and working hours to maintain their husband's breadwinner status, especially among low-income and less educated groups.

Contribution

It provides empirical evidence of gender norm effects on women's labor supply and earnings in China using discontinuity tests and fixed effect regressions.

Findings

Women diminish earnings when just out-earning husbands

Future labor participation remains unaffected

Low-income, less educated women are more influenced

Abstract

How does women's obedience to traditional gender roles affect their labour outcomes? To investigate on this question, we employ discontinuity tests and fixed effect regressions with time lag to measure how married women in China diminish their labour outcomes so as to maintain the bread-winning status of their husbands. In the first half of this research, our discontinuity test exhibits a missing mass of married women who just out-earn their husbands, which is interpreted as an evidence showing that these females diminish their earnings under the influence of gender norms. In the second half, we use fixed effect regressions with time lag to assess the change of a female's future labour outcomes if she currently earns more than her husband. Our results suggest that women's future labour participation decisions (whether they still join the workforce) are unaffected, but their yearly incomes and weekly working hours will be reduced in the future. Lastly, heterogeneous studies are conducted, showing that low-income and less educated married women are more susceptible to the influence of gender norms.