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Unconditional quantile regressions, wage growth and inequality in the Philippines, 2001--2006: the contribution of covariates

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  • Chris Sakellariou

Abstract

I implement a two-stage procedure to estimate the components of real wage change in the Philippines along the wage distribution from 2001 to 2006, as well as the contribution of individual covariates to each component. The methodology is based on Re-centred Influence Functions (RIF), as suggested by Firpo et al . (2009). The advantage of this methodology is that it not only decomposes the unconditional wage change at any quantile of the wage distribution, but also allows the characterization of the contribution of any single covariate on each component. I find that real earnings of males in the Philippines declined and the decline along the earnings distribution is generally higher at higher deciles for all males and higher at lower deciles in Manila. Decomposition results are driven by the wage structure component, while the composition effect is small and generally positive with education as the main contributor. Within the wage structure effect, the main determinants are associated with changes in the rewards of experience and occupation, along with residual change (change in intercepts).

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  • Chris Sakellariou, 2012. "Unconditional quantile regressions, wage growth and inequality in the Philippines, 2001--2006: the contribution of covariates," Applied Economics, Taylor & Francis Journals, vol. 44(29), pages 3815-3830, October.
    • Handle: RePEc:taf:applec:44:y:2012:i:29:p:3815-3830
    DOI: 10.1080/00036846.2011.581221
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    3. Simone Balestra & Uschi Backes-Gellner, 2017. "Heterogeneous effects of pupil-to-teacher ratio policies - A look at class size reduction and teacher aide," Economics of Education Working Paper Series 0130, University of Zurich, Department of Business Administration (IBW).
    4. Messinis, George, 2013. "Returns to education and urban-migrant wage differentials in China: IV quantile treatment effects," China Economic Review, Elsevier, vol. 26(C), pages 39-55.
    5. Yee, Karol Mark Ramirez, 2023. "Raising the floor while lowering the ceiling: Reduced inequities in education returns in the Philippines," International Journal of Educational Development, Elsevier, vol. 101(C).
    6. João Pereira & Maria Aurora Galego, 2015. "Inter-Country Wage Differences in the European Union," CEFAGE-UE Working Papers 2015_15, University of Evora, CEFAGE-UE (Portugal).
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    9. Aurora Galego & João Pereira, 2014. "Decomposition of Regional Wage Differences Along the Wage Distribution in Portugal: The Importance of Covariates," Environment and Planning A, , vol. 46(10), pages 2514-2532, October.
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