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Wage Differential by Employment Type and Contract Length

Author

Listed:
  • Minseoung Kim

    (Sungkyunkwan University)

  • Sunghyun Ryu

    (KDI)

Abstract

We estimate wage differentials by employment type and contract length using Oaxaca decomposition. In the Economically Active Population Survey of Korea from 2004 through 2008, we find that regular workers receive slightly higher wage rates than non-regular workers after controlling for a standard list of individual attributes. This coincides with the findings in Lee and Kim (2009) and Nam (2007) that wage discrimination explains a very small part of the observed wage differential between regular and nonregular workers. On the other hand, the wage gap between regular and nonregular workers within a subgroup of similar contract lengths can be quite significant. Among workers with longer contracts, regular workers receive significantly higher wage rates than non-regular workers. This result is in line with the findings in Kim and Park (2006) that wage discrimination between regular and non-regular workers is significant after controlling for establishment characteristics.

Suggested Citation

  • Minseoung Kim & Sunghyun Ryu, 2010. "Wage Differential by Employment Type and Contract Length," Korean Economic Review, Korean Economic Association, vol. 26, pages 157-176.
    • Handle: RePEc:kea:keappr:ker-20100630-26-1-07
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    References listed on IDEAS

    as
    1. Cotton, Jeremiah, 1988. "On the Decomposition of Wage Differentials," The Review of Economics and Statistics, MIT Press, vol. 70(2), pages 236-243, May.
    2. Blau, Francine D & Kahn, Lawrence M, 1996. "Wage Structure and Gender Earnings Differentials: An International Comparison," Economica, London School of Economics and Political Science, vol. 63(250), pages 29-62, Suppl..
    3. Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October.
    4. Lee, Lung-Fei, 1978. "Unionism and Wage Rates: A Simultaneous Equations Model with Qualitative and Limited Dependent Variables," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 19(2), pages 415-433, June.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    wage differential; wage discrimination; employment type; contract length; Oaxaca decomposition;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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