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Interethnic Wage Variation in the Helsinki Area


  • Jan Saarela

    (Department of Social Sciences, Åbo Akademi University, Finland)

  • Fjalar Finnäs

    (Institutet för Finlandssvensk Samhällsforskning, Åbo Akademi University)


This paper compares wage income of Swedish-speaking and Finnish-speaking employees in the Helsinki metropolitan area. Longitudinal data are analysed with random-effects tobit models. We find that Swedish-speaking males on average have 17 per cent higher wages than Finnish-speaking males. Two thirds of this wage gap can be attributed to characteristics differences, particularly education and age. For females the wage difference is very small. The findings echo previous research in the sense that they point out a favourable labour market performance of the Swedish-speaking minority in Finland and that differences between language groups are larger among males than among females.

Suggested Citation

  • Jan Saarela & Fjalar Finnäs, 2004. "Interethnic Wage Variation in the Helsinki Area," Finnish Economic Papers, Finnish Economic Association, vol. 17(1), pages 35-48, Spring.
  • Handle: RePEc:fep:journl:v:17:y:2004:i:1:p:35-48

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    References listed on IDEAS

    1. F. L. Jones, 1983. "On Decomposing the Wage Gap: A Critical Comment on Blinder's Method," Journal of Human Resources, University of Wisconsin Press, vol. 18(1), pages 126-130.
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    3. Saarela, Jan & Finnäs, Fjalar, 2002. "Language-Group Differences in Very Early Retirement in Finland," 10th International Conference on Panel Data, Berlin, July 5-6, 2002 A2-3, International Conferences on Panel Data.
    4. Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October.
    5. Jan Saarela & Fjalar Finnäs, 2002. "Language-group Differences in Very Early Retirement in Finland," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 7(3), pages 49-66, July.
    6. Kyyrä, Tomi, 1999. "Post-Unemployment Wages and Economic Incentives to Exit from Unemployment," Research Reports 56, VATT Institute for Economic Research.
    7. Saarela, Jan & Finnas, Fjalar, 2003. "Unemployment and native language: the Finnish case," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 32(1), pages 59-80, March.
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    JEL classification:

    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials


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