Earmarked Paternity Leave and Well-Being

Earmarked paternity leave has been introduced in an attempt to increase fathers’ involvement in child rearing and in order to achieve gender equality in the labor market and at home. So far researchers have not paid much attention to the well-being effects of such policies. This paper takes a first step in that direction by studying the impact of earmarked paternity leave quota on well-being, using 7 policy changes in the Nordic countries over the period 1993-2013. Using an RD design we find an average effect of earmarked leave policies on parental well-being that is near zero, but find heterogeneous effects based on education level. Earmarked paternity leave increases well-being for the highly educated, but not for those with less education. The wage replacement rate of the leave policy turns out to be an important driver of this effect. We show using a DDD design that the highly educated report higher well-being regardless of the replacement rate. At the same time the effects on the lower educated depend on the replacement rate. They benefit only when the replacement rate is high. This finding can be explained by a disutility from not being able to adhere to a changing gender norm regarding fathers’ role in the household.