Adaptation under traditional gender roles : testing the baseline hypothesis in South Korea

Using detailed longitudinal data from the Korean Labor and Income Panel Study (KLIPS) from 1998 to 2008, this paper analyzes gender-specific impacts as well as anticipation and adaptation to major life and labor market events. We focus on six major events: marriage, divorce, widowhood, unemployment, first job entry, and introduction of the five-day working week. While our results indicate full adaptation to some events, and even more so for women, to others we see no or only partial habituation. Yet, the results show striking gender-specific differences particularly regarding the impact of events related to marital status change. Husbands remain on a higher happiness level throughout marriage. They also suffer more from, and show less rapid or even no adaptation to widowhood and divorce. Women return to their baseline level of happiness relatively quick after marriage and divorce. Surprisingly, widowhood is not associated with negative effects for women. If anything, moderate positive effects can be found here. Husbands' additional long-run happiness gain during marriage is equivalent to an (husband-only) increase of annual per-capita household income of approximately US$17,800. We show that the intra-marriage happiness gap between husband and wife is strongly related to the intra-couple earnings difference, providing evidence for both intra-household bargaining and the gender identity hypothesis. The studied labor market events point to a gender segregated labor market. The evidence shows that more effort is needed if Korea wants to achieve higher gender equity.