Changes in Korean Maternity Protection Law and Labor Market Outcomes for Young Women

Focusing on the Korean experience, particularly a recent amendment which extends maternity leave and increases financial benefits during maternity and childcare leave, this paper evaluates how such an expansion of benefits affects the employment and the hourly wages of young women of childbearing age. Empirical results from a difference-in-difference-in-differences model having older women, older men, and young men simultaneously as the control group suggest that neither the employment nor the hourly wages of young women are affected. This implies that the law change does not cause shifts in the labor supply curve and the labor demand curve for young women.