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Inter-Industry Wage Differentials in Ireland

Author

Listed:
  • Brenda Gannon

    (The Economic and Social Research Institute, Dublin)

  • Brian Nolan

    (The Economic and Social Research Institute, Dublin)

Abstract

This paper investigates inter-industry wage differentials in Ireland, taking advantage of access to a dataset that is uniquely suitable for this purpose, the 1996 Structure of Earnings Survey. This allows us to measure not simply overall differentials in the average wage across sectors, but also the extent to which these are associated with a range of employee, job, employer and sectoral characteristics. The results show that there are substantial differences in earnings across industrial sectors in Ireland, predominantly but not only reflecting differences in measured human capital of workers and attributes of their jobs. While unobserved individual and job characteristics may underpin the remaining differentials, efficiency wage or rent-sharing could also be playing a role. Including a range of firm and sectoral characteristics relevant to the latter does not markedly alter the scale of inter-industry differentials, but firm fixed effects seem important. The dispersion of wages across industries, controlling for observed employee, job and employer characteristics, is quite high in Ireland compared to other industrialised countries.

Suggested Citation

  • Brenda Gannon & Brian Nolan, 2004. "Inter-Industry Wage Differentials in Ireland," The Economic and Social Review, Economic and Social Studies, vol. 35(2), pages 157-182.
  • Handle: RePEc:eso:journl:v:35:y:2004:i:2:p:157-182
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    References listed on IDEAS

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    Cited by:

    1. Philip Du Caju & François Rycx & Ilan Tojerow, 2012. "Wage structure effects of international trade in a small open economy: the case of Belgium," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 148(2), pages 297-331, June.
    2. Brenda Gannon & Robert Plasman & Francois Rycx & Ilan Tojerow, 2007. "Inter-Industry Wage Differentials and the Gender Wage Gap: Evidence from European Countries," The Economic and Social Review, Economic and Social Studies, vol. 38(1), pages 135-155.
    3. Robert Plasman & François Rycx & Ilan Tojerow, 2006. "Industry wage differentials, unobserved ability, and rent-sharing : Evidence from matched worker-firm data, 1995-2002," Working Paper Research 90, National Bank of Belgium.
    4. Magda, Iga & Rycx, François & Tojerow, Ilan & Valsamis, Daphné, 2008. "Wage Differentials across Sectors in Europe: An East-West Comparison," IZA Discussion Papers 3830, Institute of Labor Economics (IZA).
    5. Thierry Lallemand & Robert Plasman & François Rycx, 2007. "The establishment-size wage premium: evidence from European countries," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 34(5), pages 427-451, December.
    6. Noria, Gabriela López, 2015. "The effect of trade and FDI on inter-industry wage differentials: The case of Mexico," The North American Journal of Economics and Finance, Elsevier, vol. 34(C), pages 381-397.
    7. Mann, Stefan & Erdin, Daniel, 2005. "Die Landwirtschaft und andere Einflussgrößen auf die Bevölkerungsentwicklung im ländlichen Raum," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 54(05), pages 1-8.
    8. Evangelia Papapetrou & Pinelopi Tsalaporta, 2016. "Inter-industry wage differentials in Greece: rent-sharing and unobserved heterogeneity hypotheses," Working Papers 213, Bank of Greece.
    9. Nuno Crespo & Nádia Simões & José Castro Pinto, 2013. "Determinant factors of job quality in Europe," Working Papers Series 2 13-01, ISCTE-IUL, Business Research Unit (BRU-IUL).

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