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Gender Earnings Gap in German Firms: The Impact of Firm Characteristics and Institutions

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Author Info
Heinze, Anja
Wolf, Elke
Abstract

Most existing analyses on the gender wage gap (GWG) have neglected the establishment as a place where inequality between male and female employees arises and is maintained. The use of linked employee-employer data permits us to move beyond the individual and consider the importance of the workplace to explain gender pay differentials. That is, we first provide a comprehensive study on the effects of various firm characteristics and the institutional framework on the GWG in Germany. The innovation of our research is that we do not just compare average male and female wages (of specific groups of employees), but look at within-firm gender wage differentials. Our results indicate that the mean GWG within firms is smaller than the average overall GWG. Furthermore, we can show that firms with formalized co-determination (works council) and those covered by collective wage agreements are more likely to have smaller GWG. It is also interesting to note that the wage differential between men and women decreases with firm size and increases with the wage level. --

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Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 06-20.

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Date of creation: 2006
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Handle: RePEc:zbw:zewdip:4599

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Related research
Keywords: gender wage gap; unions; works councils; discrimination; within-firms wage differentials;

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Find related papers by JEL classification:
J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Gupta, Nabanita Datta, 1993. "Probabilities of Job Choice and Employer Selection and Male-Female Occupational Differences," American Economic Review, American Economic Association, vol. 83(2), pages 57-61, May. [Downloadable!] (restricted)
  2. Datta Gupta, Nabanita & Tor, Eriksson, 2005. "New workplace practices and the gender wage gap," Working Papers 04-18, University of Aarhus, Aarhus School of Business, Department of Economics. [Downloadable!]
  3. Fitzenberger, Bernd & Wunderlich, Gaby, 2000. "Gender wage differences in West Germany : a cohort analysis," ZEW Discussion Papers 00-48, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
  4. Marie Drolet, 2002. "Can the Workplace Explain Canadian Gender Pay Differentials?," Canadian Public Policy, University of Toronto Press, vol. 28(s1), pages 41-63, May. [Downloadable!] (restricted)
  5. Kevin Reilly & Tony Wirjanto, 1999. "Does More Mean Less? The Male/Female Wage Gap and the Proportion of Females at the Establishment Level," Canadian Journal of Economics, Canadian Economics Association, vol. 32(4), pages 906-929, August. [Downloadable!] (restricted)
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  6. John M. Abowd & Francis Kramarz & David N. Margolis, 1999. "High Wage Workers and High Wage Firms," Econometrica, Econometric Society, vol. 67(2), pages 251-334, March.
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  7. Meng, Xin, 2004. "Gender earnings gap: the role of firm specific effects," Labour Economics, Elsevier, vol. 11(5), pages 555-573, October. [Downloadable!] (restricted)
  8. Xin Meng & Dominique Meurs, 2004. "The gender earnings gap: effects of institutions and firms--a comparative study of French and Australian private firms," Oxford Economic Papers, Oxford University Press, vol. 56(2), pages 189-208, April. [Downloadable!] (restricted)
  9. Richard B. Freeman, 1980. "Unionism and the Dispersion of Wages," NBER Working Papers 0248, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  10. Francine D. Blau & Lawrence M. Kahn, 1996. "The Gender Earnings Gap: Some International Evidence," NBER Working Papers 4224, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  11. Nabanita Datta Gupta & Donna S. Rothstein, 2005. "The Impact of Worker and Establishment-level Characteristics on Male-Female Wage Differentials: Evidence from Danish Matched Employee-Employer Data," LABOUR, CEIS, Fondazione Giacomo Brodolini and Blackwell Publishing Ltd, vol. 19(1), pages 1-34, 03. [Downloadable!] (restricted)
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  12. Kenneth Arrow, 1971. "The Theory of Discrimination," Working Papers 403, Princeton University, Department of Economics, Industrial Relations Section.. [Downloadable!]
  13. Olaf H¸bler & Uwe Jirjahn, 2003. "Works Councils and Collective Bargaining in Germany: The Impact on Productivity and Wages," Scottish Journal of Political Economy, Scottish Economic Society, vol. 50(4), pages 471-491, 09. [Downloadable!] (restricted)
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  14. Richard B. Freeman & Lawrence F. Katz, 1995. "Differences and Changes in Wage Structures," NBER Books, National Bureau of Economic Research, Inc, number free95-1.
  15. Gartner, Hermann & Stephan, Gesine, 2004. "How collective contracts and works councils reduce the gender wage gap," IAB Discussion Paper 200407, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]. [Downloadable!]
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  1. Dohmen, Thomas & Lehmann, Hartmut & Zaiceva, Anzelika, 2008. "The Gender Earnings Gap inside a Russian Firm: First Evidence from Personnel Data – 1997 to 2002," IZA Discussion Papers 3428, Institute for the Study of Labor (IZA). [Downloadable!]
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  2. Thomas Dohmen & Hartmut Lehmann & Anzelika Zaiceva, 2008. "The Gender Earnings Gap inside a Russian Firm: First Evidence from Personnel Data - 1997 to 2002 ; Updated Version," ESCIRRU Working Papers 6, DIW Berlin, German Institute for Economic Research. [Downloadable!]
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