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Does Pay Transparency Affect the Gender Wage Gap? Evidence From Austria

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  • Andreas Gulyas
  • Sebastian Seitz
  • Sourav Sinha

Abstract

We study the 2011 Austrian Pay Transparency Law, which requires firms above a size threshold to publish reports on the gender pay gap. We exploit variation across firm size and time, to study the effects of transparency on the gender wage gap and individual wages, using the universe of Austrian social security records. Our results show that the policy had no discernible effects on male and female wages, and therefore no significant effects on the gender wage gap. The effects are precisely estimated and we can rule out that the policy narrowed the gender wage gap by more than half a percentage point. We find no evidence for wage compression at the establishment level. The policy led to an increase in the retention rate of workers, which points towards higher job satisfaction due to pay transparency.

Suggested Citation

  • Andreas Gulyas & Sebastian Seitz & Sourav Sinha, 2020. "Does Pay Transparency Affect the Gender Wage Gap? Evidence From Austria," CRC TR 224 Discussion Paper Series crctr224_2020_194v1, University of Bonn and University of Mannheim, Germany.
    • Handle: RePEc:bon:boncrc:crctr224_2020_194v1
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    1. Srikant Devaraj & Pankaj C. Patel, 2022. "State bans on pay secrecy and earnings: Evidence from the National Longitudinal Survey of Youth 1997," British Journal of Industrial Relations, London School of Economics, vol. 60(4), pages 697-734, December.
    2. René Böheim & Sarah Gust, 2022. "The Austrian Pay Transparency Law and the Gender Wage Gap," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 23(02), pages 25-28, March.
    3. Pirmin Fessler & Severin Rapp, 2023. "The subjective wealth distribution: How it arises and why it matters to inform policy? (Pirmin Fessler, Severin Rapp)," Working Papers 249, Oesterreichische Nationalbank (Austrian Central Bank).
    4. Diego Gentile Passaro & Fuhito Kojima & Bobak Pakzad-Hurson, 2023. "Equal Pay for Similar Work," Papers 2306.17111, arXiv.org.
    5. Chen, Yunsi & Hu, Dezhuang, 2023. "Why are exporters more gender-friendly? Evidence from China," Economic Modelling, Elsevier, vol. 118(C).
    6. Duchini, Emma & Simion, Stefania & Turrell, Arthur, 2020. "Pay Transparency and Cracks in the Glass Ceiling," The Warwick Economics Research Paper Series (TWERPS) 1311, University of Warwick, Department of Economics.
    7. Van Phan & Carl Singleton & Alex Bryson & John Forth & Felix Ritchie & Lucy Stokes & Damian Whittard, 2023. "Accounting for firms in gender-ethnicity wage gaps throughout the earnings distribution," Economics Discussion Papers em-dp2023-16, Department of Economics, University of Reading.
    8. Julia B. Bear & Robin Pinkley & Zoe Barsness & Jens Mazei & Nazli Bhatia & Dustin J. Sleesman, 2023. "Gender, Pay Transparency, and Competitiveness: Why Salary Information Sometimes, but Not Always, Mitigates Gender Gaps in Salary Negotiations," Group Decision and Negotiation, Springer, vol. 32(5), pages 1143-1163, October.
    9. Melanie Jones & Ezgi Kaya, 2023. "The UK gender pay gap: Does firm size matter?," Economica, London School of Economics and Political Science, vol. 90(359), pages 937-952, July.
    10. Frimmel, Wolfgang & Schmidpeter, Bernhard & Wiesinger, Rene & Winter-Ebmer, Rudolf, 2023. "External pay transparency and the gender wage gap," Ruhr Economic Papers 1027, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    11. Jakob Alfitian & Marvin Deversi & Dirk Sliwka, 2023. "Closing the Gender Gap in Salary Increases: Evidence from a Field Experiment on Promoting Pay Equity," ECONtribute Discussion Papers Series 244, University of Bonn and University of Cologne, Germany.
    12. Corey Allan & David C. Maré, 2022. "Who benefits from firm success? Heterogeneous rent-sharing in New Zealand," Working Papers 22_03, Motu Economic and Public Policy Research.
    13. Wolfgang Frimmel & Bernhard Schmidpeter & Rene Wiesinger & Rudolf Winter-Ebmer, 2022. "Mandatory Wage Posting, Bargaining and the Gender Wage Gap," Economics working papers 2022-02, Department of Economics, Johannes Kepler University Linz, Austria.
    14. Jack Blundell, 2021. "Wage responses to gender pay gap reporting requirements," CEP Discussion Papers dp1750, Centre for Economic Performance, LSE.
    15. Bamieh, Omar & Ziegler, Lennart, 2022. "Can Wage Transparency Alleviate Gender Sorting in the Labor Market?," IZA Discussion Papers 15363, Institute of Labor Economics (IZA).
    16. Abudy, Menachem (Meni) & Aharon, David Y. & Shust, Efrat, 2023. "Can gender Pay-Gap disclosures make a difference?," Finance Research Letters, Elsevier, vol. 52(C).
    17. Blundell, Jack, 2021. "Wage responses to gender pay gap reporting requirements," LSE Research Online Documents on Economics 114416, London School of Economics and Political Science, LSE Library.
    18. Sourav Sinha, 2022. "US Salary History Bans -- Strategic Disclosure by Job Applicants and the Gender Pay Gap," Papers 2202.03602, arXiv.org.
    19. René Böheim & Marian Fink & Christine Zulehner, 2021. "Die Entwicklung des Lohnunterschiedes zwischen Frauen und Männern in Österreich von 2005 bis 2019," WIFO Research Briefs 2, WIFO.
    20. Julien Picault, 2023. "A strategic approach to managerial compliance with equal pay policies," SN Business & Economics, Springer, vol. 3(8), pages 1-21, August.

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    More about this item

    Keywords

    Pay Transparency; Gender Wage Gap;

    JEL classification:

    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • J78 - Labor and Demographic Economics - - Labor Discrimination - - - Public Policy (including comparable worth)

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