Analyzing the gender pay gap

Empirical research on gender pay gaps has traditionally focused on the role of gender-specific factors, particularly gender differences in qualifications and differences in the treatment of otherwise equally qualified male and female workers (i.e., labor market discrimination). This paper explores the determinants of the gender pay gap and argues for the importance of an additional factor, wage structure, the array of prices set for labor market skills and the rewards received for employment in favored sectors. Drawing on our previous work we illustrate the impact of wage structure by presenting empirical results analyzing its effect on international differences in the gender gap and trends over time in the gender differential in the U.S.