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Wage differentials between Permanent and Temporal Contracts: Further Evidence

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  • Felgueroso, Florentino
  • De la Rica Goiricelaya, Sara

Abstract

The main objective of this paper is to estimate wage differentials between permanent and temporal workers for different qualification levels and decompose such differentials to see which factors contribute more to explain them. The data we use is the "Encuesta de Estructura Salarial", a survey carried out in 1995 in all countries of the European Union, which contains very detailed information on wages and other characteristics for about 180.000 workers. The empirical results indicate that (a) the wage gap between permanent and temporal workers increases with qualification and it is smaller for females than for males, (b) when decomposing average wage differentials for each qualification level, we observe that the vast majority of such differential is explainedby differences in characteristics, and in particular by differences in tenure and occupation. With respect to differences in returns, our results indicate that the returns to tenure are higher for temporal workres relative to permanent workers for both males and females and for every qualification level. Returns to occupation are higher for permanent than for temporal workers, and the differenceis particularly high for females.

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Bibliographic Info

Paper provided by University of the Basque Country - Department of Foundations of Economic Analysis II in its series DFAEII Working Papers with number 2002-07.

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Date of creation: Jul 1999
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Handle: RePEc:ehu:dfaeii:200207

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Postal: Dpto. de Fundamentos del Análisis Económico II, = Facultad de CC. Económicas y Empresariales, Universidad del País Vasco, Avda. Lehendakari Aguirre 83, 48015 Bilbao, Spain
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Related research

Keywords: Oaxaca decomposition; wage differentials;

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Cited by:
  1. Rebekka Christopoulou & Theodora Kosma, 2009. "Skills and wage inequality in Greece: evidence from matched employer-employee data, 1995-2002," LSE Research Online Documents on Economics 24198, London School of Economics and Political Science, LSE Library.
  2. Bosio, Giulio, 2009. "Temporary employment and wage gap with permanent jobs: evidence from quantile regression," MPRA Paper 16055, University Library of Munich, Germany.
  3. Güell, Maia & Petrongolo, Barbara, 2003. "How Binding Are Legal Limits? Transitions from Temporary to Permanent Work in Spain," IZA Discussion Papers 782, Institute for the Study of Labor (IZA).
  4. Juan José Dolado & Carlos García-Serrano & Juan F. Jimeno, . "Drawing Lessons from the Boom of Temporary Jobs in Spain," Working Papers 2001-11, FEDEA.
  5. Ernesto Villanueva, 2004. "Compensating wage differentials and voluntary job changes: Evidence from West Germany," Economics Working Papers 738, Department of Economics and Business, Universitat Pompeu Fabra.
  6. Javier Gardeazabal & Arantza Ugidos, . "Measuring the gender gap at different quantiles of the wage distribution," Studies on the Spanish Economy 108, FEDEA.

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