Earning Inequalities Between and Within Nests: A Multilevel Modeling Approach Applied to the Case of France
AbstractThis paper presents a simultaneously study of the impact of gender and localization inequalities on the earnings of under-graduates. Using multilevel modeling, the framework draws both individual-level (i.e., pertaining to the individual elements of groups) and aggregate-level (i.e., pertaining to the group as a whole) data under a single specification, in order to study their potential interactions. These inequalities are studied with respect to young workers who left higher education in 2004 and who had a full-time job in the private sector three years after graduation (i.e., in 2007). To take into account the process of selection for employment, our multilevel model uses the Heckman two-step procedure. Following this approach, Occupational Groups (OG) are found to capture 59.4% of the earning heterogeneity whereas Employment Area (EA) nests capture 7.6%. This 59.4% figure is explained by two phenomena: (i) OG are dominated by seniors, and (ii) OG are dominated by males with higher earnings. These group characteristics also influence gender inequalities: there is a higher wage penalty for females in (i) OG dominated by males, and (ii) OG dominated by senior workers. In contrast to the gender gap, immigrant inequalities manifest closer links to EA. Policy implications are derived from our results.
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Bibliographic InfoPaper provided by Center for Research in Economics and Management (CREM), University of Rennes 1, University of Caen and CNRS in its series Economics Working Paper Archive (University of Rennes 1 & University of Caen) with number 201118.
Date of creation: Oct 2011
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Postal: CREM (UMR CNRS 6211) - Faculty of Economics, 7 place Hoche, 35065 Rennes Cedex - France
Find related papers by JEL classification:
- I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
- R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
- D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-10-15 (All new papers)
- NEP-LAB-2011-10-15 (Labour Economics)
- NEP-LMA-2011-10-15 (Labor Markets - Supply, Demand, & Wages)
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