WAGE INEQUALITY IN TURKEY: DECOMPOSITION BY STATISTICAL REGIONS, 1980–2001

This paper analyzes wage inequality in the Turkish manufacturing sector annually from 1980 to 2001, and also provides some evidence for inequality in the post‐2001 period. Using the between‐groups component of Theil's T statistic, the paper provides more information on wage inequality. It decomposes the evolution of inequality by statistical regions – The Nomenclature of Territorial Units for Statistics – (i.e. NUTS‐1 and NUTS‐2). The decompositions show that inequality has increased since the late 1980s in the private sector both between regions of NUTS‐1 and NUTS‐2.     

FACTORS OF INTERREGIONAL INCOME INEQUALITY IN POSTWAR JAPAN: THEIL DECOMPOSITION AND GAP ACCOUNTING ANALYSES

This study empirically identifies some factors of interregional income inequality in postwar Japan during the period 1955–2005 using a decomposition analysis with a Theil L index and a gap accounting analysis. One major empirical finding was that interregional inequality in per capita GDP during the period 1955–2005 showed a double peaked M‐shaped curve, which was predominantly attributed to interregional inequality in labor productivity. The sectoral decomposition analysis revealed that the factors that caused fluctuations in interregional inequality in labor productivity differed from year to year. The fluctuations during the period 1960–1980 were caused by an intersectoral equilibrating process between the tertiary sector and other sectors, whereas that the fluctuations that occurred in the late 1980s and early 1990s resulted from interregional disequilibrating and equilibrating processes within the tertiary sector.     

THE COLLAPSE OF PRIMARY SCHOOLING RETURNS IN SOUTH AFRICA 1960–90

By 1975, the effect of a year's primary schooling upon the wages of Africans in South Africa had fallen to about 2.5 percent — one of the lowest primary schooling returns in the world. Secondary schooling returns were high throughout the period 1960–90. The collapse of primary schooling returns was due to declining school quality, an increase in the supply of primary school graduates, an increase in mining wages in the mid-seventies, and wage regulation by the Industrial Councils and Wage Boards. The low level of the return, compared with the returns to other races in South Africa, is due to the low quality of African primary schools. Implications for education spending patterns and wage regulation are pointed out.     

SOURCES OF REGIONAL INCOME INEQUALITY: AN EXAMINATION OF SMALL REGIONS IN QUEENSLAND

In this study, data for the 125 Local Government Areas of Queensland are used to explain the cross-sectional variation in the Gini coefficient of income inequality. This study updates earlier work for Australian regions that has used the 1981, 1986 and 1991 census data sets and incorporates a wider range of variables, allowing the testing of several competing hypotheses. The study commences with an analysis of the spatial pattern of income inequality in Queensland. Previous work in this area has not considered problems such as spatial autocorrelation, and although no evidence of this is found, the testing uncovers heteroscedasticity with the estimation techniques used in the final version of the model accounting for this problem.     

EXPLAINING RISING INEQUALITY: SKILL‐BIASED TECHNICAL CHANGE AND NORTH–SOUTH TRADE*

Abstract We review the ‘skill‐biased technological change (SBTC) versus North–South trade (NST)’ debate in order to explain widening wage inequality between skilled and unskilled workers. The traditional explanations based on exogenous SBTC and on the North–South Heckscher–Ohlin–Samuelson approach, as well as the early estimates that diagnosed a clear prevalence of the former, are firstly exposed and discussed. A presentation is then made of the recent theoretical literature that endogenizes SBTC, introduces new channels of impacts from NST, and combines both explanations. Finally, the current estimates show that (i) both explanations are relevant, (ii) their impacts differ according to industries and countries, (iii) outsourcing is the main vector of impact from NST and (iv) SBTC and NST interact.     

FISCAL DECENTRALIZATION AND INTERGOVERNMENTAL RELATIONS: AN ANALYSIS OF FEDERAL VERSUS STATE EDUCATION FINANCE IN MEXICO

While decentralization is on the forefront of the reform agenda of many developing countries, few studies have performed empirical analysis to provide a holistic picture of the important fiscal, efficiency, and equity issues. Specifically, decentralization nearly always involves fiscal and administrative decisions by both national and sub-national governments, as well as intricate intergovernmental relations. Here, two empirical models are presented for the Mexican primary and secondary education sector. The first analyzes the efficiency-equity trade-off implicit the Mexican Federal Government's educational fiscal transfers to states. Unlike most similar analyses, this model analyzes the distribution of outcomes not simply expenditures. The second model analyzes the relative productivity of separate expenditures by the Federal and state governments before Mexico's recent educational decentralization legislation. The findings show that before the decentralization, the Federal Government exhibited some concern for equity, but that in doing so also treated states unequally according to criteria that have little to do with either efficiency or equity. In addition, the results show that the Federal Government may indeed have been the more efficient provider of primary and secondary education, raising concern for the fiscal and administrative relationship set up by the decentralization legislation: the Federal Government will continue to pay, while the states have gained relative autonomy over expenditures.     

DECOMPOSITION OF LABOUR DEMAND BY EMPLOYER SECTORS AND GENDER: FINDINGS FOR MAJOR EXPORTING SECTORS IN TURKEY

This paper attempts to provide insight into the likely impacts of the current global crisis on employment in Turkey. As this crisis hits the Turkish economy through a demand squeeze in the international market, our focus is on the labour demand generated by major export sectors. The decomposition of impacts with respect to gender is of particular interest given the significant gender imbalances in the labour market. The findings indicate that female (male) employment is most sensitive to wearing apparel (trade) exports. In general, employment generation potentials of major export sectors are found to be weaker for females and stronger in agriculture, trade and finance, while they are very limited in manufacturing for both genders.     

DO MIGRANTS REACT TO INFRASTRUCTURE DIFFERENCE BETWEEN URBAN AND RURAL AREAS? DEVELOPMENT OF AN EXTENDED HARRIS–TODARO MODEL

Developing an extended model of the basic Harris–Todaro model of rural–urban migration, we analyze the effects of infrastructure availability together with time-tested income effects while accommodating government behavior through the provision and financing of infrastructure. Our theoretical analysis confirms that infrastructure presence can be a significant factor in making migration decisions. Comparison with the basic Harris–Todaro model also reveals that while the Todaro paradox is absent in the basic model, it can be present in the extended model.