Job Attachment and Life Cycle Gender Wage Differences (Job Market Paper)
Employment interruptions are more common among women than men, with substantial individual-level heterogeneity. Employers value job attachment but job attachment is not directly observed. I show that the information problem of female job attachment is detrimental to female labor market outcomes. I propose a model where there is information asymmetry about female job attachment but not about male job attachment in a frictional labor market. To screen female job attachment, employers offer separating wage contracts that distort the wage profiles of high-attachment women. The distortions suppress female job-to-job mobility, resulting in worse labor market outcomes than comparable men. Using data from the National Longitudinal Survey of Youth, I document evidence on the gender differences in mobility patterns and wage growth that support the assumptions and the predictions of the model. I then calibrate the model and quantify the contributing factors to the gender wage gap. The calibrated model captures the gender differences in the data. The gender difference in job-to-job mobility explains a majority of the life cycle gender wage gap.
Employee or Contractor: Work Arrangements under Hidden Actions and Unobserved Ability