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A Detailed Decomposition Analysis of the Public-Private Sector Wage Gap in South Africa

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  • Magejo, Prudence

    (University of the Witwatersrand, Johannesburg)

  • Benhura, Miracle

    (University of the Witwatersrand, Johannesburg)

Abstract

The present study examines the public-private sector wage gap in South Africa using individual cross section data for 2000-7. Results from unconditional quantile regressions and generalised Oaxaca-Blinder type decompositions show that the wage gap is inverted-U shaped across the wage distribution. The 'composition' effect is more important than the 'price' effect at the bottom of the distribution while the opposite applies at the top. Key factors underpinning the 'composition' effect are unionisation, industry of employment and education, while those associated with the 'price' effect are education, race and occupation.

Suggested Citation

  • Magejo, Prudence & Benhura, Miracle, 2015. "A Detailed Decomposition Analysis of the Public-Private Sector Wage Gap in South Africa," IZA Discussion Papers 9271, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp9271
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    More about this item

    Keywords

    public sector; wage gap; recentered influence function; decomposition;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets

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