Why Do American Women Work More Than Europeans?

Economists Indraneel Chakraborty and Hans Holter have an explanation for all those extra hours Americans work as compared to Europeans: divorce rates (and tax rates)  Here’s their theory:

We believe this is because marriage provides an implicit social insurance since the spouses are able to share their income. However, if divorce rates are higher in a society, women have a higher incentive to obtain work experience in case they find themselves alone in the future. The reason the incentive is higher is because in our data, women happen to be the second earner in the household more often than men. European women anticipate not getting divorced as often and hence find less reason to insure themselves by working as much as American women.

Chakraborty and Holter use U.S data to run a model testing their theory; their findings are interesting:

We find that stable marriages lead to a reduction in labour supply. Both in the data and in the model the effect is on the extensive margin, i.e. whether women will choose to work or not. In our counterfactual economy, if just marriage stability in US were the same as in the European countries, it explains 24% of the cross-country variation in hours worked for females. When we also introduce European taxes, we are able to explain 43% of the variation in female work hours across the continents.

 The authors also point out that Americans started working more in the 1970’s, right around the time the US started passing “no-fault” divorce laws and well before Europe started adopting such laws.

 


random name

im sure it has nothing to do with that fact that 2 incomes are required to make it in america

Mike B

One income is more than enough to ensure that a family has food and clothing, just like it used to be back in the day. However as a Western lifestyle has accumulated more costs it is easier if both economic actors in a typical family unit are gainfully employed. I would say it is a triumph of gender role equality that both partners are expected/encouraged to get out and perform some useful task. As the west faces ever more competition from the east it will be critical to maximize labour force participation.

random name

sure if 1 person makes more than twice the average salary than once income is perfect; you surely can't be saying that all single incomes are adequate to support a family when low wage jobs can't even support an individual

ahoy

In a nutshell, instability leads to production out of fear.

Ally

The authors of this study seem to assume that women who don't "work" are sitting around doing nothing. Most women who don't "work" are actually performing a plethora of unpaid but critical functions. They are, among other things, child-rearers, educators, carers, counsellors, cooks, cleaners, event organizers and volunteers. When women go into paid employment, other people get paid to do the work they would have done for nothing. So perhaps stable marriages reduce both labor supply and demand in terms of the visible economy, but I would be greatly surprised if less work actually gets done.

Des

I think you may be reading a bit too much into it.

Carla FW

Nonsense. The stress of trying to get by in the United States actually contributes very much to our higher tendency to divorce. That's because we lack the European social safety net and must pay far higher out of pocket costs for things like health care and child care and education, all of which are much more heavily subsidized by the European states. It is this additional financial stress which contributes to the high divorce rates and also creates a self-perpetuating cycle of financial instability which continues to make preserving a marriage more difficult.

Word

Cite Prescott 2004 plz.

Jake W.

Or, maybe the fact that women started working and earning more opened the door for divorce. You know, some sort of I-am-making-$50,000-I-don't-need-you mentality.

random name

was this article a little sexist sounding?

Dana

Interesting theory but I don't think it really holds water. Europeans work less because of the structure of the labor laws in European socialist countries which provide very strong job security to employees. You basically cannot be fired, there are limits to how much overtime you can work and overtime wages are taxed at the highest tax rate, no matter what your overall income so you get very little by way of compensation for overtime work. I would say that these factors rather than "happier marriages" account for this.

People don't work as long of hours simply because they don't have to.

Also, the divorce rate is lower in Europe, not because more marriages are happy but because there are less marriages. In most European socialist countries it is possible to attain all the rights and status of marriage without marriage and many couples (at least in Holland) live with their partners without marriage. No marriage means no divorce and a lower divorce rate.

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pawnman

Why do American women work more than European women? Maybe because Americans in general work more than Europeans in general.

paul

Hello,

Do not forget that some countries are still very conservative, and women with kids are not supposed to work. In Switzerland or southern Germany, Women's life is still ruled by the KKK : Kinder, Küche, Kirche.
Go try to find a babysitter in northern Switzerland !

regards, paul

Harry

Building a family is such a heavy responsibility. In most cases, financial issue is one of the major causes of problems. Although some acknowledge that women are just second earners in the household income, it is also a significant contribution to be able to support the families' needs. And in some cases, women also want to find their worth by getting equal rights and share in the household income.

tmeier

I don't understand. It seems like there is an elementary mistake here. The divorce rate in America is only higher compared to the general population, it is much lower compared to the number of married persons. America only has a high divorce rate because it has the highest marriage rate. Belgium has the highest divorce to marriage rate, followed by Sweden.

Europeans just don't get married nearly as much.