Labor Economics

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Women, war and wages: The effect of female labor supply on the wage structure at mid-century

This paper investigates the effects of female labor supply on the wage structure. To identify variation in female labor supply, we exploit the military mobilization for World War II, which drew many women into the workforce as males exited civilian employment. The extent of mobilization was not uniform across states, however, with the fraction of eligible males serving ranging from 41 to 54 percent. We find that in states with greater mobilization of men, women worked substantially more after the War and in 1950, though not in 1940. We interpret these differentials as labor supply shifts induced by the War. We find that increases in female labor supply lower female wages, lower male wages, and increase the college and premium and male wage inequality generally. Our findings indicate that at mid-century, women were closer substitutes to high school graduate and relatively low-skill males, but not to those with the lowest skills.

Full reference: Acemoglu, D., Autor, D., & Lyle, D. (2004) “Women, war and wages: The effect of female labor supply on the wage structure at mid-century” Journal of Political Economy

Chap3_Acemoglu_Autor_Lyle

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