Career Interruptions due to Parental Leave - A Comparative Study of Denmark and Sweden

Parental leave mandates are associated with high female employment rates, but with reductions in <p> relative female wages if leave is of extended duration. We analyze the impact of family policies <p> (parental leave and childcare prices) of Denmark and Sweden on women’s career breaks due to <p> childbirth. These countries are culturally similar and share the same type of welfare state ideology, <p> but differ remarkably in pursued family policies. Our analysis takes advantage of the availability <p> of comparable longitudinal data and allows us to estimate parallel models across the two <p> countries. The impact of family policies and economic incentives on the probability of returning <p> to the labor market is estimated using a duration model approach. Our results show that <p> economic incentives affect the behavior of mothers in both countries. However, the parental <p> leave mandates as such are very important determinants for the observed behavior. Based on <p> policy simulations we find that if fathers were given more parental leave, it would promote the <p> labor supply of women.