Wage differentials by sector and gender: a quantile analysis for the Spanish case

This paper analyses existing wage differentials between workers in the public and private sectors and by gender in Spain. This analysis is run throughout the entire earnings distribution and observed wage differentials are decomposed into a part explained by differences in productive characteristics and a part due to differences in returns to such characteristics. Our results show that public sector workers tend to earn higher wages than private employees, although most of this sector wage gap is due to better public workers’ productive characteristics. A wage premium in favour of men is also found in both the public and private sectors, with the gender wage gap greater at the top of the earnings distribution.     

Quantile regression for duration data: A reappraisal of the Pennsylvania Reemployment Bonus Experiments

We argue that quantile regression methods can play a constructive role in the analysis of duration (survival) data offering a more flexible, more complete analysis than is typically available with more conventional methods. We illustrate the approach with a reanalysis of the data from the Pennsylvania Reemployment Bonus Experiments. These experiments, conducted in 1988–89, were designed to test the efficacy of cash bonuses paid for early reemployment in shortening the length of insured unemployment spells     

The gender difference in wages and the returns to schooling over the great recession in the U.S.

This paper examines the effects of the Great Recession on the gender difference in hourly wage and the rate of return to schooling in the United States. Using data from American Community Survey 2000–2015, we find that the male-female difference in hourly wage declined during and after the recession. The Great Recession decreased earnings for both men and women, especially for those with more education. We also find there is a significant gender difference in the effects of the Great Recession on the returns to schooling. The Great Recession increased the rate of return to schooling for both men and women, and the female-male difference in the returns to schooling decreased by 0.4 percentage points in the post-recession period. The change of the gender difference in the returns to schooling can be explained by the wage structure change for men and women over the recession.     

Wage differentials across sectors in Europe

Using a unique harmonized linked employer–employee dataset, this paper analyses the structure and determinants of inter‐industry wage differentials in Central and Eastern European countries (Czech Republic, Latvia, Lithuania and Poland) and compares them to those observed in Western European states. Findings show substantial differences in earnings across sectors in all countries, even when controlling for a wide range of employee, job and employer characteristics. The hierarchy of sectors in terms of wages appears to be quite similar in Eastern and Western European countries, although the former tend to have higher levels of dispersion of inter‐industry wage differentials.     

Foreign direct investment and wage differentials in Taiwan

Abstract

The ease of restrictions on foreign direct investment in China since 1990 has attracted a continuous and dramatic flow of outward investment from Taiwan to the mainland. At the same time, the relative wages for skilled workers in Taiwan have risen mildly despite a rapid increase in the share of educated workers in its labor market. The aim of this paper is to explore the linkage between capital outflows to China and the wage share of skilled workers in Taiwan over the period 1991 – 2001. We find that the pattern of changes in relative wages is consistent with shifts in the relative demand for skilled labor. For the most part, the increases in the relative demand for skilled workers could be attributable to within-industry factors. Findings also indicate that outward direct investment to China has a significantly positive impact on the skilled labor wage share.     

My Choice: Women’s Contraceptive-Use Autonomy in Bangladesh

ABSTRACT

Using a nationally representative household survey for two cohorts of married women, this study examines women’s contraceptive-use autonomy (CUA) incidence and correlates in Bangladesh, focusing on the role of education. Previous research has examined the incidence and correlates of contraceptive use and of several dimensions of female autonomy but only rarely the intersection of the two – that is, CUA. This study finds that women from the younger cohort are far more likely to have complete autonomy over contraceptive use than women from the older cohort. Detailed decompositions reveal that the improvement in education across cohorts is the main correlate of the improved generational CUA gap. Health knowledge, especially knowledge that the use of condoms can help avoid contracting HIV/AIDS, is part of the transmission mechanism between women’s education and women’s CUA but also exerts an additional influence on CUA.     

Income maximization and the selection and sorting of international migrants

Two prominent features of international labor movements are that the more educated are more likely to emigrate (positive selection) and more educated migrants are more likely to settle in destination countries with high rewards to skill (positive sorting). Using data on emigrant stocks by schooling level and source country in OECD destinations, we find that a simple model of income maximization can account for both phenomena. Results on selection show that migrants for a source-destination pair are more educated relative to non-migrants the larger is the absolute skill-related difference in earnings between the destination country and the source. Results on sorting indicate that the relative stock of more educated migrants in a destination is increasing in the absolute earnings difference between high and low-skilled workers. We use our framework to compare alternative specifications of international migration, estimate the magnitude of migration costs by source-destination pair, and assess the contribution of wage differences to how migrants sort themselves across destination countries.     

Shadow price of working in the shadows: services industry evidence

ABSTRACT

In this paper, we use an exogenous policy variation in the labour market to determine the wage gap between formally and informally employed workers. For our purposes, ‘informal employment’ describes employees who are not officially registered with any social security scheme. We use self-reported employee registration status to identify such workers, but the choice of working unregistered is not exogenous. Nevertheless, through an amnesty that was extended to only some workers in the labour market, we reduce the endogeneity problem, enabling estimation of the wage gap between these two groups. Our two-stage least square estimates reveal that the hourly wage penalty of working in the shadows is as high as 59%, and the monthly salary penalty is around 66%. Moreover, the wage gap is higher (as high as 70%) for those working in the services sector, as unregistered workers in this sector tend to be low skilled and low educated, and the monitoring of this sector is more difficult. Our analysis contributes to the literature by using an instrumental variable to treat the endogeneity of workers’ registration status. In addition, it shows that people working informally in the services industry receive a higher average wage penalty than other informally employed workers.     

On returns differentials

Estimates of U.S. returns differentials have ranged from exorbitant to quite small, in part because of their volatility coupled with the relatively short time series available. We shed light on underlying drivers of returns differentials by presenting a number of decompositions: a by-asset-class decomposition into yields and capital gains, the Gourinchas and Rey (2007a) composition and return effects, and further decompositions of capital gains that focus on exchange rate effects. While each decomposition informs thinking about returns differentials, one constant is evident throughout: to date the existing differential favoring the U.S. has owed primarily to one factor, a differential in direct investment yields. We discuss how our analysis informs the income puzzle (of positive net income flows to the U.S. even as its net international investment position is negative and substantial) and the position puzzle (of a sizeable gap between the reported U.S. net international position and cumulated current account deficits), provide an initial assessment of the literature on the dynamics of returns differentials, and present a framework to guide a forward-looking view of how returns differentials might evolve in the future.     

Why are population flows so persistent?

A neoclassical model of local growth is developed by integrating the static equilibrium underlying compensating differential theory as the steady state of a neoclassical growth model. Numerical results show that even very small frictions to labor and capital mobility along with small changes in local productivity or local quality of life suffice to cause highly persistent population flows. Wages and house prices, in contrast, jump most of the way to their new steady state. The model suggests that cross-sectional regressions of local population growth can help to identify past and present changes in the determinants of representative-agent welfare. More generally, it provides a framework for interpreting observed local growth rates.