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Understanding the gender wage-gap differential between the public and private sectors in Italy: A quantile approach

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  • Castagnetti, Carolina
  • Giorgetti, Maria Letizia

Abstract

This paper analyzes the gender-based wage gaps across the wage distribution in the private and public sectors in Italy for the years 2005–2010. We use quantile regression methods to estimate and decompose the wage gap at all wage levels and propose a two-step procedure that relies on a novel approach to estimating fixed effects quantile regressions. The method's main advantage is that it allows the employment sector's marginal effect on wages at various points of the distribution to be estimated, while accounting for both observable and time-invariant unobservable factors. The new method stresses important differences with respect to standard decomposition analyses and amplifies the differences in the two sectors' wage-setting mechanisms. When the estimation is net of individual heterogeneity, the gender-based wage gap decreases in both sectors and there is evidence of a glass ceiling effect, but only in the public sector. Economic grounds are provided.

Suggested Citation

  • Castagnetti, Carolina & Giorgetti, Maria Letizia, 2019. "Understanding the gender wage-gap differential between the public and private sectors in Italy: A quantile approach," Economic Modelling, Elsevier, vol. 78(C), pages 240-261.
    • Handle: RePEc:eee:ecmode:v:78:y:2019:i:c:p:240-261
    DOI: 10.1016/j.econmod.2018.09.025
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    More about this item

    Keywords

    Gender wage gap; Quantile regression for panel; Public-private wage differential;
    All these keywords.

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets

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