Credit market competition and the gender gap in labor force participation: Evidence from local markets

We exploit the exogenous variation in regional credit market competition brought on by banking deregulation to study the evolution of the gender gap in labor force participation in local US markets. We find that intrastate deregulation increased substantially female labor force participation rates, owing to three separate mechanisms: an increase in the rates of net job creation by private firms, an expansion of services-producing sectors, and an increase in the share of jobs requiring female-specific skills. This effect is robust to controlling for a range of socio-economic developments, as well as for a US-wide gender-specific trend. Overall, intrastate deregulation reduced the gender gap in labor force participation by at least 7.5%. (C) 2019 Elsevier B.V. All rights reserved.