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Generalized measures of wage differentials

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  • Van Kerm, Philippe

    (CEPS/INSTEAD)

Abstract

This paper considers new 'distributionally sensitive' summary measures of wage differentials, not solely determined by "the average wage of the average person" but by differences across complete wage distributions. Considerations of risk or inequality aversion in the assessment of wage differentials are explicitly included, transplanting expected utility concepts familiar to income distribution analysts. In an application to the gender pay gap in Luxembourg the disadvantage of women persists with the new generalized measures of wage differentials. This suggests that lower average wages for women are not compensated by less dispersed distributions. The paper also illustrates original estimation of wage distributions in the presence of covariates and under endogenous labour market participation.

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Bibliographic Info

Paper provided by IRISS at CEPS/INSTEAD in its series IRISS Working Paper Series with number 2009-08.

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Length: 19 pages
Date of creation: Aug 2009
Date of revision:
Handle: RePEc:irs:iriswp:2009-08

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Keywords: wage differentials ; discrimination ; expected utility ; Singh-Maddala ; Luxembourg;

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References

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Cited by:
  1. Verme, Paolo, 2009. "Happiness, Deprivation and the Alter Ego," IRISS Working Paper Series 2009-18, IRISS at CEPS/INSTEAD.
  2. Ekaterina Selezneva & Philippe Van Kerm, 2013. "Inequality-Adjusted Gender Wage Differentials in Germany," SOEPpapers on Multidisciplinary Panel Data Research 579, DIW Berlin, The German Socio-Economic Panel (SOEP).
  3. Yalonetzky, Gaston, 2012. "Measuring group disadvantage with inter-distributional inequality indices: A critical review and some amendments to existing indices," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 6(9), pages 1-32.
  4. VAN KERM Philippe & YU Seunghee & CHOE Chung, 2014. "Wage differentials between native, immigrant and cross-border workers: Evidence and model comparisons," CEPS/INSTEAD Working Paper Series 2014-05, CEPS/INSTEAD.

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