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Changes in the Distribution of Male and Female Wages Accounting for Employment Composition Using Bounds

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Author Info
Blundell, Richard (University College London, IFS and IZA Bonn)
Gosling, Amanda (University of Essex, IFS and CEPR)
Ichimura, Hidehiko (University College London and IFS)
Meghir, Costas () (University College London, IFS, CEPR and IZA Bonn)

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Abstract

This paper examines changes in the distribution of wages using bounds to allow for the impact of non-random selection into work. We show that bounds constructed without any economic or statistical assumptions can be informative. However, since employment rates in the UK are often low they are not informative about changes in educational or gender wage differentials. Thus we explore ways to tighten these bounds using restrictions motivated from economic theory. With these assumptions we find convincing evidence of an increase in inequality within education groups, changes in the "return" to education and increases in the relative wages of women.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1350.

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Length: 50 pages
Date of creation: Oct 2004
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Handle: RePEc:iza:izadps:dp1350

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Related research
Keywords: wage differentials selection models bounds

Other versions of this item:

Find related papers by JEL classification:
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
C24 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Truncated and Censored Models

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References listed on IDEAS
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