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Regional Wage Differentials: Static And Dynamic Approaches

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  • Joao Pereira

    ()
    (Universidade de Evora, Departamento de Economia)

  • Aurora Galego

    ()
    (Universidade de Evora, Departamento de Economia)

Abstract

This work aims at studying regional wage differentials both in a static and in a dynamic perspective. Previous studies have typically studied this issue using the Blinder and Oaxaca static decomposition. This approach does not provide clear information about the sources explaining the change in regional wage differentials along the years. To overcome this problem this study also uses Junh, Murphy and Pierce (1991,1993) decomposition. We analyse the case of Portugal for 1995 and 2002. Our results show that, although there are small changes in the interregional wage inequality, particularly between the region of Lisboa and the other regions, there are important and counteracting factors shaping this outcome. In fact, Lisboa has reinforced its position as the region with more qualified workers, but the gap in unobserved characteristics has decreased.

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Bibliographic Info

Paper provided by University of Evora, CEFAGE-UE (Portugal) in its series CEFAGE-UE Working Papers with number 2007_07.

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Length: 30 pages
Date of creation: 2007
Date of revision:
Handle: RePEc:cfe:wpcefa:2007_07

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Keywords: Regions; Wage Differentials; Wage Gap Decompositions;

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Cited by:
  1. Freguglia, Ricardo S. & Menezes, Naercio A., 2011. "Inter-regional Wage Differentials with Individual Heterogeneity: Evidence from Brazil," Insper Working Papers wpe_231, Insper Working Paper, Insper Instituto de Ensino e Pesquisa.
  2. Eric Delattre & Jean-Baptiste Combès & Bob Elliott & Diane Skatun, 2012. "Hospital Staffing and Local Pay: an Investigation into the Impact of Local variations in the Competitiveness of Nurses Pay on the Staffing of Hospitals in France," THEMA Working Papers 2012-35, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
  3. Aurora Galego & João Pereira, 2013. "Decomposition of Regional Wage Differences Along the Wage Distribution in Portugal: the Importance of Covariates," CEFAGE-UE Working Papers 2013_16, University of Evora, CEFAGE-UE (Portugal).

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