Performance Pay,the Gender Gap,and Specialization within Marriage

We show that the large gender earnings gap at the top of the distribution (the glass ceiling) and the motherhood penalty are associated with each other and that both are uniquely associated with performance pay. These patterns appear consistent with specialization by gender. We show that among married couples with children, the hours worked by wives are strongly and persistently negatively correlated with earnings of the husbands only when those husbands work in performance pay jobs. There is no correlation between husbands’ hours and wives’ earnings.