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The Role Of Ethics In Economics And Business

Author

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  • Rahmah Ismail

    (Department of Economics and Development, Faculty of Economics, Universiti Kebangsaan Malaysia, 43600 Bangi, Selangor Darul Ehsan)

  • Zulridah Mohd. Noor

Abstract

Studies have found that on average males earn substantially higher wages than females. Females are paid lower than their male counterparts due to several reasons such as educational attainment, job characteristics and types of industries. Even after accounting for variations in these productivity- related characteristics, gender wage differentials may still prevail as a result of discriminatory practice by employers. This paper attempts to measure the determinants of wage differentials by gender in the Malaysian manufacturing sector. The analysis is based on a survey of 2,046 workers in six major industries conducted in 1999. These are the electrical and electronics, textile, woodbased, transport equipment, food and chemical industries. The determinants of wage differentials are obtained by using the coefficients of the earnings functions. These factors are decomposed into several categories, namely, demographic factors, human capital, job characteristics and industry characteristics. The results reveal that demographic factors and human capital variables play a major role in determining the wage differentials by gender. The divergence coefficient, which might include discriminatory practice by the employers, is also quite small.

Suggested Citation

  • Rahmah Ismail & Zulridah Mohd. Noor, 2005. "The Role Of Ethics In Economics And Business," IIUM Journal of Economics and Management, IIUM Journal of Economis and Management, vol. 13(2), pages 119-138, December.
  • Handle: RePEc:ije:journl:v:13:y:2005:i:2:p:119-138
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    File URL: http://www.iium.edu.my/enmjournal/132art1.pdf
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    References listed on IDEAS

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    1. Mincer, Jacob & Polachek, Solomon, 1974. "Family Investment in Human Capital: Earnings of Women," Journal of Political Economy, University of Chicago Press, vol. 82(2), pages 76-108, Part II, .
    2. Paul Sicilian & Adam Grossberg, 2001. "Investment in human capital and gender wage differences: evidence from the NLSY," Applied Economics, Taylor & Francis Journals, vol. 33(4), pages 463-471.
    3. Francine D. Blau, 1998. "Trends in the Well-Being of American Women, 1970-1995," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 112-165, March.
    4. William A. Darity & Patrick L. Mason, 1998. "Evidence on Discrimination in Employment: Codes of Color, Codes of Gender," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 63-90, Spring.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Gender wage differentials; Manufacturing sector; Malaysia;

    JEL classification:

    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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