Credit Market Competition and the Gender Gap: Evidence from Local Labor Markets

53 Pages Posted: 14 Jul 2017

See all articles by Alexander A. Popov

Alexander A. Popov

European Central Bank (ECB)

Sonia Zaharia

Tufts University - Friedman School of Nutrition Science and Policy

Date Written: July 12, 2017

Abstract

We exploit the exogenous variation in regional credit market contestability brought on by banking deregulation in the United States to study the narrowing of the gender gap in local labor markets. We find that deregulation reduced the gender gap in labor force participation, as the subsequent increase in the demand for labor induced non-working women to enter the labor force. Deregulation also reduced wage inequality as women became more likely to work in the private sector, to enter high-paid "male" jobs, and to acquire higher education. Tests of contiguous MSAs sharing a state border corroborate a genuine deregulation effect.

Keywords: Bank Deregulation, Gender Gap, Labor Force Participation, Wage Inequality

JEL Classification: G28, J16, J22

Suggested Citation

Popov, Alexander A. and Zaharia, Sonia, Credit Market Competition and the Gender Gap: Evidence from Local Labor Markets (July 12, 2017). ECB Working Paper No. 2086, Available at SSRN: https://ssrn.com/abstract=3001640

Alexander A. Popov (Contact Author)

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

Sonia Zaharia

Tufts University - Friedman School of Nutrition Science and Policy ( email )

150 Harrison Avenue
Boston, MA 02111
United States

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