Birth Timing and Spacing: Implications for Parental Leave Dynamics and Child Penalties

Abstract

We use rich population-level administrative data from Denmark to develop new facts about the relationship between the timing and spacing of births and labor market outcomes. We show that there is substantial heterogeneity in the age at first birth across maternal skill levels. The spacing of pregnancies is also tighter on average for highly skilled mothers, resulting in them experiencing higher levels of fertility and time on parental leave in the years immediately after first birth. We estimate event studies by skill level and find that much of the child penalties in earnings and participation in the 5 years following first birth can be explained by incapacitation effects from parental leave around subsequent births, especially for the highly educated.