Why Do Lazy People Make More Money? The Strange Case of the Public Sector Wage Premium
AbstractEmpirical work suggests the presence of a public sector wage premium, the reasons for which are investigated in this paper. The results demonstrate a higher premium paid to women and premium decreases concurrent with skills. Job security undermines the incentive to work hard and forces the public sector to pay higher wages. Thus, the public sector wage premium can be used as an indicator of inefficiency in the public sector.
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Bibliographic InfoPaper provided by Inter-American Development Bank, Research Department in its series Research Department Publications with number 4176.
Date of creation: Aug 1999
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