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Does Childcare Cost Women More? A Study of the GenderIncome Gap in Pakistan Yishan Shi and Kiyoshi TaniguchiNo. 819 | November 2025 Yishan Shi (yishan.shi@ucdconnect.ie) is a PhDcandidate at the University College Dublin.Kiyoshi Taniguchi (ktaniguchi@adb.org) is aregional lead economist at the Economic Research TheADB Economics Working Paper Seriespresents research in progress to elicit commentsand encourage debate on development issuesin Asia and the Pacific. The views expressedare those of the authors and do not necessarily Creative Commons Attribution 3.0 IGO license (CC BY 3.0 IGO) © 2025 Asian Development Bank6 ADB Avenue, Mandaluyong City, 1550 Metro Manila, Philippines Some rights reserved. Published in 2025. ISSN 2313-6537 (print), 2313-6545 (PDF)Publication Stock No. WPS250450-2DOI: http://dx.doi.org/10.22617/WPS250450-2 The views expressed in this publication are those of the authors and do not necessarily reflect the views and policiesof the Asian Development Bank (ADB) or its Board of Governors or the governments they represent. ADB does not guarantee the accuracy of the data included in this publication and accepts no responsibility for anyconsequence of their use. The mention of specific companies or products of manufacturers does not imply that they By making any designation of or reference to a particular territory or geographic area in this document, ADB does notintend to make any judgments as to the legal or other status of any territory or area. This publication is available under the Creative Commons Attribution 3.0 IGO license (CC BY 3.0 IGO)https://creativecommons.org/licenses/by/3.0/igo/. By using the content of this publication, you agree to be boundby the terms of this license. For attribution, translations, adaptations, and permissions, please read the provisions This CC license does not apply to non-ADB copyright materials in this publication. If the material is attributedto another source, please contact the copyright owner or publisher of that source for permission to reproduce it. Please contact pubsmarketing@adb.org if you have questions or comments with respect to content, or if you wishto obtain copyright permission for your intended use that does not fall within these terms, or for permission to use ABSTRACT This paper examines the economic costs of caregiving for women in Pakistan, with afocus on the caregiving wage penalty and its variation across the wage distribution andbetween urban and rural contexts. Using nationally representative data from the PakistanSocial and Living Standards Measurement Survey 2019–2020, the analysis combinesPropensity Score Matching (PSM), Ordinary Least Squares (OLS), Recentered InfluenceFunction (RIF) regressions, and RIF–Oaxaca decompositions. PSM estimates indicatethat female caregivers earn approximately 44% less than comparable non-caregivers,while OLS results confirm a penalty of around 48%. Extending the analysis to theintensivemargin,each additional child is associated with a wage reduction ofapproximately 12%, although the effect diminishes with increasing family size. Thepresence of a young child (aged 0–6) results in a significant penalty, whereas the Keywords:women, gender inequality, wage penalty, child penalty, socioeconomicchallenges, Pakistan, policy interventions JEL codes:J13, J31, O15, R28 I.INTRODUCTION Asymmetry in childcare responsibilities is a primary cause of gender gaps in the labormarket. Gender inequality remains a persistent challenge worldwide, with profoundimplications for economic growth, social stability, and individual wellbeing. In Pakistan,gender disparities are particularly acute, rooted in historical, cultural, and institutionalnormsthat limit women’s opportunities in education,employment,and political Caregiving duties—whether for children, elderly relatives, or other dependents—shapewomen’slabor market trajectories by reducing working hours,interrupting careerprogression, and increasing concentration in low-wage or informal sectors (Schmitz andWestphal 2017). In contrast, men’s employment outcomes are far less affected bycaregiving, underscoring a persistent gender asymmetry in economic consequences. An additional dimension that remains underexplored in the Pakistani context is theintersection of caregiving and geographic disparities in the labor market. Urban and ruralareas differ substantially in terms of infrastructure, educational attainment, occupationalstructure, and access to formal employment—factors that are likely to interact withcaregiving responsibilities in shaping women’s economic outcomes. Caregivers in ruralareas may face compounded disadvantages owing to limited childcare facilities, fewer This study examines the wage penalty associated with caregiving in Pakistan, with aparticular focus on differences between urban and rural caregivers among women. Usingmicrodata from the Pakistan Social and Living Standards Measurement (PSLM) Survey,we adopt a four-stage analytic