The Last Hurdle? Unyielding Motherhood Effects in the Context of Declining Gender Inequality in Latin America

Abstract

We assess whether motherhood could be the last hurdle to achieving gender equality in developing countries by exploring the link between motherhood and the overall gender gap in the labor market for 14 Latin American countries over the last two decades. Using pseudo- panels built from harmonized household surveys and an event study approach around the birth of the first child, we find that the arrival of the first child leads to a sharp and persistent 35% decline in mothers’ earnings. This result is explained by a reduction in employment and a prompting shift towards occupations that favor more flexible work arrangements, including part-time and informal jobs. These effects are pervasive across countries and population groups. Furthermore, using an extended version of the Oaxaca-Blinder decomposition, we identify motherhood as the primary source of income inequality between men and women. Motherhood explains 42% of the remaining gender gap and has progressively gained relative importance over the last two decades while other contributing factors, such as education and its associated returns, have shown a waning impact. Moreover, we find no clear cross- country association between the motherhood-related gap and per capita GDP or gender norms, while the contribution of other factors to the gender gap in earnings diminishes with higher per capita GDP and more gender-egalitarian social norms. This suggests that gender gaps stemming from the motherhood effect exhibit greater rigidity than other drivers of gender inequality.