Women and Resource Windfalls: The Norwegian Oil Boom

Jan 2020 | 223

Authors: Patrick Bennett, Chiara Ravetti, Po Yin Wong

This paper uses the first discovery of oil a nd gas in Norway as a natural experiment to study the long run labour market implications of a positive economic shock. Existing studies largely focus on short term dynamics and on men, but the effects on women and their persistence in time are less known. Following the same individuals for up to two decades in the Norwegian Registry and Census data, we find that the oil discovery significantly increased male earnings (up to 7% annually), while female earnings declined (more than 10%). The shift in annual income is still present 15 years after the discovery. Labour force participation increased among men, while it declined for women in full-time employment. Specifically, the decline in female earnings was driven by married women. Moreover, men in oil regions shifted into high-paying occupations while women did the opposite after the discovery of oil. However, the income loss for women is mostly a short-term phenomenon: we find that women’s lifetime income improved for later cohorts.

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