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On the sharing of temporary parental leave: the case of Sweden

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Abstract

This paper views temporary parental leave (leave from work to take care of a sick child) as a household public good, produced with time inputs of the parents as the only input. Assuming equal productivities in the production of temporary parental leave and equal utility functions of the spouses, different household decision-making processes are applied to develop theoretical hypotheses on sharing that are thereafter tested empirically. The empirical estimations show that the decision-making process of the spouses can be explained by a Stackelberg model with male dominance. A stronger threat-point of the female is found to push the intra household allocation of temporary parental leave towards greater sharing between the spouses. In addition, an increase in the insurance ceiling will further sharing of temporary parental leave in some families, while reducing it in others.

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Notes

  1. Up to 15 months at a reimbursement rate of eighty percent of the Sickness Allowance Based (SBI) income from the time of the birth until the child is 8 years old. The SBI is an approximation of each parent’s present yearly income, but has a lower limit of 9,200 and an upper limit of 273,000 krona a year (Hedlund 1999).

  2. Information about parental and temporary parental leave can be obtained from the Swedish insurance board’s web-page (see the reference list).

  3. In special cases, the insurance period can be extended by another 60 days and in cases of serious illnesses, parents of children in the ages 12–16 can be compensated through the temporary parental leave insurance.

  4. For example, the so-called "daddy-month" law was introduced in 1995 and extended to 2 months in 2002. This law reserves at least 2 months of the total parental leave for the father and was passed to increase the proportion of parental leave taken by men (Ekberg et al. 2004).

  5. See e.g., Haas (1992), Näsman (1992), RFV 1993:3, Sundström and Dufvander (1998) and Albrecht et al. (1999)

  6. A number of cultural factors might also influence the parents’ productivities. For example, women are often seen as more suited to take care of babies and it is often thought that fathers find babies less interesting than older children (see Ahrne and Roman 1997).

  7. Alternative models of the household to the ones discussed in this paper are developed e.g. by Grossbard-Shechtman (1993) and Folbre (1994).

  8. In a repeated non-cooperative model, both Pareto optimal and non-optimal outcomes will be among the possible equilibria (Lundberg and Pollack 1994).

  9. In Sweden, the wealthier spouse is (in general) not obliged to pay alimony to the poorer spouse after a divorce. Child support (in general) has to be paid, the amount depending on the incomes and expenses of the respective spouses and on the need of the child (Familjerätt 1999).

  10. Since it is likely that spouses take account of the risk of being divorced while married, we argue that the utility if divorced is a reasonable interpretation of the threat-point for Swedish individuals in bargaining models.

  11. See Lommerud (1997) for a more extensive overview.

  12. This assumption is made since we cannot control for other types of household production or leisure empirically. We will return to the (empirical) problems connected to these assumptions in Sect. 3.1.

  13. We disregard unearned income for two reasons. First, unearned income will not affect the opportunity cost of taking a day of temporary parental leave and will therefore probably have little effect on sharing. Second, we do not have any empirical information on unearned income.

  14. If spouses were maximizing the gains from cooperation, the spouse with the lowest income should take all temporary parental leave. However, the data shows that this is in general not the case, and therefore we choose to focus on non-cooperative models.

  15. This is a model of private provision of public goods, introduced by Theodore et al. (1986), applied to our context. See also Ermisch (2003) for a family application of this model.

  16. It should be noted that if one of the spouses has the higher wage, either spouse can take more temporary parental leave. This holds in both the Cournot and the Stackelberg model. Thus, we can only separate between the models when wages are equal.

  17. The name of the Swedish Insurance Board (Riksförsäkringsverket) was changed to the Swedish Social Insurance Agency (Försäkringskassan) on the 1st of January 2005.

  18. We do not have any information regarding whether the male and female are married or cohabiting. The word “spouse” should therefore not be interpreted to mean that the male and the female are actually married.

  19. As expected, there are fewer and older children in households that did not use the insurance. There are nearly no differences in income and sector, whereas more individuals who did not use the insurance are in the lowest and in the highest education categories, compared to individuals who did use the insurance.

  20. These results can be obtained from the author on request.

  21. Greene (2003) shows that maximum likelihood and weighted least squares have the same asymptotic properties.

  22. We find that women take larger shares of temporary parental leave the higher their incomes, but lower shares the higher their educations. Regarding income, it is likely that the female’s income is strongly correlated with the male’s income, which might explain the positive effect of income on her share. As regards education, we cannot, as previously pointed out, control for differences in type, which might largely influence sharing.

  23. It should be noted, that of the almost 35,000 women in our sample, only two are older, more highly educated, have higher incomes, work in the private sector and have partners who work in the public sector. The result for the “female strong” family is therefore highly hypothetical.

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Acknowledgement

The author wishes to thank Inga Persson, John Ermisch, Katarina Nordblom, Katarina Katz, David Edgerton, Kristian Bolin, Dan-Olof Rooth, Katarina Steen-Carlsson, Robin Rander, Mårten Wallette, Martin Nordin, Curt Wells, Shoshana Grossbard and two anonymous referees for helpful comments. Financing from the Swedish Insurance Agency and the Crafoord foundation is gratefully acknowledged.

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Authors and Affiliations

  1. Department of Economics, Lund University, P. O. Box 7082, 220 07, Lund, Sweden

    Anna Amilon

  2. The Danish National Center for Social Research, Copenhagen, Denmark

    Anna Amilon

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Correspondence to Anna Amilon.

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Amilon, A. On the sharing of temporary parental leave: the case of Sweden. Rev Econ Household 5, 385–404 (2007). https://doi.org/10.1007/s11150-007-9015-0

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