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Public-Private Wage Gap in Australia: Variation Along the Distribution

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Author Info
Lixin Cai
Amy Y.C. Liu

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Abstract

Previous research on public-private wage differentials in Australia is scarce and has focused on the central parts of the conditional wage distribution. Using the first six waves of the Household, Income and Labour Dynamics in Australia (HILDA) survey, this study applies quantile regression models to examine whether the sectoral wage effect varies along the wage distribution. For females, we find public sector wage premiums for almost the entire wage distribution and the premiums are relatively stable except at the extremities of the distribution. For males, the premiums decrease monotonically and are negative for the top half of the conditional wage distribution. The decomposition results show that the observed differences in individuals and job characteristics account for a substantial proportion of the overall sectoral wage gap.

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Paper provided by Centre for Economic Policy Research, Research School of Social Sciences, Australian National University in its series CEPR Discussion Papers with number 581.

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Date of creation: Jun 2008
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Handle: RePEc:auu:dpaper:581

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Related research
Keywords: wage gap; quantile regression; decomposition;

Find related papers by JEL classification:
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets

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