DP9970 Gender Gaps and the Rise of the Service Economy

Author(s): Liwa Rachel Ngai, Barbara Petrongolo
Publication Date: May 2014
Keyword(s): gender gaps, marketization, structural transformation
JEL(s): E24, J16, J22
Programme Areas: International Macroeconomics, Labour Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=9970

This paper investigates the role of the rise of services in the narrowing of gender gaps in hours and wages in recent decades. We document the between-industry component of the rise in female work for the U.S., and propose a model economy with goods, services and home production, in which women have a comparative advantage in producing market and home services. The rise of services, driven by structural transformation and marketization of home production, acts as a gender-biased demand shift raising women?s relative wages and market hours. Quantitatively, the model accounts for an important share of the observed trends.