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Changes in Wage Structure in Urban India, 1983–2004: A Quantile Regression Decomposition

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  • Azam, Mehtabul

Abstract

This paper utilizes individual level earnings data from urban India to examine the evolution of wages during 1983–2004 across the entire wage distribution. Quantile regression analysis reveals that the effects of many covariates are not constant across distribution. Returns to secondary and tertiary education not only increased in the 1990s but also became more heterogeneous suggesting wage inequality may increase further in near future as more workers get higher education. Moreover, the quantile regression decomposition suggests that the increase in returns has been the driving force behind the increase in wages in both the 1980s and 1990s.

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  • Azam, Mehtabul, 2012. "Changes in Wage Structure in Urban India, 1983–2004: A Quantile Regression Decomposition," World Development, Elsevier, vol. 40(6), pages 1135-1150.
    • Handle: RePEc:eee:wdevel:v:40:y:2012:i:6:p:1135-1150
    DOI: 10.1016/j.worlddev.2012.02.002
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    More about this item

    Keywords

    earning functions; Asia; India; quantile regression; decomposition; wage inequality;
    All these keywords.

    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Statistical Simulation Methods: General

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