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Decomposing Inequality Change in East Germany During Transition

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Author Info

  • Gang, Ira N.

    ()
    (Rutgers University)

  • Yun, Myeong-Su

    ()
    (Tulane University)

Abstract

This paper studies the cause of the changes, or lack of, in wage inequality in East Germany during its transition from a socialist to a market-oriented economic system. We are interested in how much of the change in the dispersion of wages can be explained by the changes in the characteristics of workers and how much can be explained by the changes in returns to characteristics of workers.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 579.

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Length: 17 pages
Date of creation: Sep 2002
Date of revision:
Publication status: published as: 'Decomposing Male Inequality Change in East Germany During Transition' in: Schmollers Jahrbuch: Zeitschrift für Wirtschafts- und Sozialwissenschaften /Journal of Applied Social Science Studies, 2003, 123 (1), 43-54
Handle: RePEc:iza:izadps:dp579

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Related research

Keywords: residuals effect; decomposition analysis of inequality; coefficients (price) effect; earnings equation; characteristics (quantity) effect;

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References

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  1. Alan B. Krueger & Jorn-Steffen Pischke, 1995. "A Comparative Analysis of East and West German Labor Markets: Before and After Unification," NBER Chapters, in: Differences and Changes in Wage Structures, pages 405-446 National Bureau of Economic Research, Inc.
  2. Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October.
  3. Hunt, Jennifer, 1998. "The Transition in East Germany: When is a Ten Point Fall in the Gender Wage Gap Bad News?," CEPR Discussion Papers 1805, C.E.P.R. Discussion Papers.
  4. Katharine G. Abraham & Susan N. Houseman, 1993. "Earnings Inequality in Germany," NBER Working Papers 4541, National Bureau of Economic Research, Inc.
  5. Franz, Wolfgang & Steiner, Viktor, 1999. "Wages in the East German transition process: facts and explanations," ZEW Discussion Papers 99-40, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  6. Alan S. Blinder, 1973. "Wage Discrimination: Reduced Form and Structural Estimates," Journal of Human Resources, University of Wisconsin Press, vol. 8(4), pages 436-455.
  7. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 410-42, June.
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Citations

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Cited by:
  1. Bellmann, Lutz & Gartner, Hermann, 2003. "Fakten zur Entwicklung der qualifikatorischen und sektoralen Lohnstruktur (Facts on the development of the qualification-related and sectoral wage structure)," Mitteilungen aus der Arbeitsmarkt- und Berufsforschung, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 36(4), pages 493-508.
  2. Usamah Fayez Al-Farhan, 2010. "Changes in the Gender Wage Gap in Germany during a Period of Rising Wage Inequality 1999-2006: Was it Discrimination in the Returns to Human Capital?," SOEPpapers on Multidisciplinary Panel Data Research 293, DIW Berlin, The German Socio-Economic Panel (SOEP).
  3. Usamah Fayez Al-Farhan, 2010. "A Detailed Decomposition of Changes in Wage Inequality in Reunified Post-transition Germany 1999-2006: Accounting for Sample Selection," SOEPpapers on Multidisciplinary Panel Data Research 269, DIW Berlin, The German Socio-Economic Panel (SOEP).
  4. Papps, Kerry L., 2004. "Income Inequality and Gender in New Zealand, 1998-2003," IZA Discussion Papers 1365, Institute for the Study of Labor (IZA).
  5. Kang, Byung-Goo & Yun, Myeong-Su, 2008. "Changes in Korean Wage Inequality, 1980−2005," IZA Discussion Papers 3780, Institute for the Study of Labor (IZA).
  6. Ira N. Gang & Robert C. Stuart & Myeong-Su Yun, 2006. "Wage Growth and Inequality Change During Rapid Economic Transition," Departmental Working Papers 200631, Rutgers University, Department of Economics.

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