Parental leave institutions in eighteen post-war welfare states

Abstract: This study applies a macro-comparative and institutional approach to the study of incentive structures, determinants and outcomes of legislated parental leave benefits. Parental leave is defined as all benefits directed to mothers, fathers or both parents to facilitate parental childcare during the early post-natal period. By separating different aspects of such institutions, prospects are improved to analyze how paid parental leave shapes agency, actions and living conditions of parents and children. For this purpose, new institutional data on such benefits has been collected. The included countries are Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, New Zealand, Norway, Sweden, Switzerland, the United Kingdom and the United States.While cross-national differences were relatively small in the first post-war decades, divergences in parental leave institutions increased in the 1970s, when fathers also became recognized as potential carers in paid parental leave legislation. The inclusion of fathers follow along the lines of two separate dimensions of family policy, the first supporting a dual earner family type, and the latter one mainly preserving traditional family patterns. The dual earner strategy mainly includes earnings-related parental insurance programs, while the general family support strategy includes flat-rate parental leave benefits. Overall, parental leave policies show few signs of general policy retrenchment, but have rather expanded in most countries at the same time as cross-national institutional designs have diverged. Some countries, moreover, have undergone a gradual development towards a contradictory family policy model where both support to traditional family patterns and dual earner families are well developed.Analysing potential determinants behind the two different dimensions of parental leave in eighteen countries between 1970 and 1995, using pooled time-series cross-section regressions, shows that hypotheses derived from a power resources perspective, emphasizing the relative power of different political actors, appears most congruent with cross-national developments of parental leave programs. Left party incumbency as well as women’s representation in cabinets have positive correlations with the dual earner support dimension of paid leave, while confessional party and left party incumbency both are positively correlated to the cross-national development of general family support. Structural-economic and state-structural explanations overall receive little support.Multivariate analyses of paid parental leave, fertility and female labor force participation between 1970 and 1995 indicate that different institutions of parental leave have divergent relationships to the demographic outcomes. Parental leave in support of a dual earner family has a positive correlation with both fertility and female economic activity. Paid leave in support of the traditional family is negatively related to female labor force participation, while having a positive relationship to fertility. To the extent that this outcome reflects underlying motives of different political actors, paid leave institutions may be viewed as intervening variables. Parental leave benefits may, however, partly function as indicators on the broader social policy setting, including other public transfers and social services.Analyses on macro-relationships between first-year paid parental leave generosity and poverty among families with infants demonstrate a strong negative correlation. Disaggregating paid leave along the lines of the two dimensions (dual earner support and general family support) shows that earnings-related parental leave accounts for the main part of this relationship between policy and potential outcome. Controlling for other socio-political, demographic and structural-economic factors basically leaves earnings-related benefits as the only factor with a consistent significant and negative correlation with such distributive outcomes. The way policies structure these poverty risks has implications not only for the well-being of members in poor families, but may also shape the future agency of children growing up under such circumstances, as well as the agency of parents-to-be, whose childbearing decisions may be affected by potential future poverty risks.A central conclusion to be drawn from the study is that an institutional approach may greatly improve the understanding of how welfare states through programs of paid parental leave shape parental agency around paid and unpaid work as well as childbearing decisions. Thus, institutionalism and an actor-oriented perspective can be fruitfully combined in explaining development and outcomes of different family policy strategies, viewing social policy institutions as ‘intervening’ variables between causal factors and outcomes