Paid Parental Leave and Children's Schooling Outcomes

This article investigates whether schooling outcomes at age 15 are affected by the duration of maternity leave, i.e. the time mothers spend at home with their new-born before returning to work. We exploit an unanticipated reform in Austria which extended the maximum duration of paid and job protected parental leave from 12 to 24 months for births as of 1 July, 1990. Using PISA data from the cohorts 1990 and 1987, we find no significant overall impact of the parental leave extension on standardised test scores. However, subgroup analyses reveal strong heterogeneity by maternal education and child gender.