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An Analysis of the Determinants of Wage and Salary Differentials in Bangladesh

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  • Kazi Abrar Hossain
  • Sharjil Muktafi Haque
  • A.K. Enamul Haque

Abstract

The Gini Index suggests that income inequality is a highly prevalent phenomenon in Southeast Asia (The World Bank, 2012a). As Zaman and Akita (2012) points out, differentials in income is especially prominent in Bangladesh. Our article investigates which factors create differentials in income in Bangladesh. Using data from the Household Income Expenditure Survey published by the Bangladesh Bureau of Statistics, we estimated two separate models—one for daily wage and one for annual salary. We found that education, age (which was used as a proxy for labour market experience), gender and place of work significantly brought about differentials in daily wage rates. We also observed that all four of the above variables, along with different types of occupations, caused differentials in annual salary. We conclude by making several policy recommendations to address these findings.

Suggested Citation

  • Kazi Abrar Hossain & Sharjil Muktafi Haque & A.K. Enamul Haque, 2015. "An Analysis of the Determinants of Wage and Salary Differentials in Bangladesh," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 16(2), pages 295-308, September.
    • Handle: RePEc:sae:soueco:v:16:y:2015:i:2:p:295-308
    DOI: 10.1177/1391561415598467
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    References listed on IDEAS

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    1. Intan NURPRATIWI & Syamsurijal AK & YUNISVITA, 2020. "Factors that influence wages differences in formal sector on male and female workers in Palembang City," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(1(622), S), pages 147-158, Spring.
    2. Intan Nurpratiwi & Syamsurijal Abdul Kadir & Yunisvita Yunisvita, 2019. "Factors that Influence Wages Differences in Formal Sector on Male and Female Workers in Palembang City," Business & Management Compass, University of Economics Varna, issue 4, pages 327-343.

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    More about this item

    Keywords

    Labour market; income disparity; determinants of wage differential; gender disparity; age-earnings relationship; Household Income Expenditure Survey; Bangladesh;
    All these keywords.

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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