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Wage differentials in Belgium: the role of worker and employer characteristics

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  • Robert Plasman
  • François Rycx
  • Ilan Tojerow

Abstract

This paper examines the role of worker and employer characteristics in the determination of wages in the Belgian private sector. Empirical findings, based on detailed matched employer-employee data covering the period 1995-2002, reveal the existence ceteris paribus of: i) a substantial but decreasing return on education, ii) a large and stable gender wage gap, iii) an increasing wage penalty for those employed on a fixed term contract, iv) a positive and persistent employer-size wage effect, v) small and slightly declining regional wage differentials, and vi) a positive but moderate effect of company collective agreements on workers’ wages. Further results show persistent but decreasing wage differentials between workers with the same observed characteristics and working conditions, employed in different sectors.

Suggested Citation

  • Robert Plasman & François Rycx & Ilan Tojerow, 2007. "Wage differentials in Belgium: the role of worker and employer characteristics," DULBEA Working Papers 07-12.RS, ULB -- Universite Libre de Bruxelles.
  • Handle: RePEc:dul:wpaper:07-12rs
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    References listed on IDEAS

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    3. Bernal, Oscar & Oosterlinck, Kim & Szafarz, Ariane, 2010. "Observing bailout expectations during a total eclipse of the sun," Journal of International Money and Finance, Elsevier, vol. 29(7), pages 1193-1205, November.
    4. Nilsen, Øivind Anti & Raknerud, Arvid & Skjerpen, Terje, 2011. "Using the Helmert-transformation to reduce dimensionality in a mixed model: Application to a wage equation with worker and firm heterogeneity," Discussion Paper Series in Economics 11/2011, Norwegian School of Economics, Department of Economics, revised 04 Oct 2011.
    5. Henri Capron, 2007. "Politique de cohésion et développement régional," DULBEA Working Papers 07-16.RS, ULB -- Universite Libre de Bruxelles.
    6. Ariane Szafarz, 2007. "Hiring people-like-yourself: a representation of discrimination on the job market," DULBEA Working Papers 07-21.RS, ULB -- Universite Libre de Bruxelles.
    7. Ilan Tojerow, 2008. "Industry Wage Differentials Rent Sharing and Gender in Belgium," Reflets et perspectives de la vie économique, De Boeck Université, vol. 0(3), pages 55-65.
    8. Jean Luc De Meulemeester, 2007. "L'économie de l'éducation fait-elle des progrès? Une perspective d'histoire de la pensée économique," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 50(1), pages 89-111.
    9. Hassan Ayoub & Jérôme Creel & Etienne Farvaque, 2008. "Détermination du niveau des prix et finances: le cas du Liban 1965-2005," DULBEA Working Papers 08-10.RS, ULB -- Universite Libre de Bruxelles.
    10. Benoît Mahy & François Rycx & Mélanie Volral, 2008. "L'influence de la dispersion salariale sur la performance des grandes entreprises belges," Reflets et perspectives de la vie économique, De Boeck Université, vol. 0(3), pages 27-40.
    11. Henri Capron & Michele Cincera, 2007. "EU pre-competitive and near-the-market S&T collaborations," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 50(1), pages 135-159.
    12. Charles Plaigin, 2009. "Exploratory study on the presence of cultural and institutional growth spillovers," DULBEA Working Papers 09-03.RS, ULB -- Universite Libre de Bruxelles.
    13. Øivind A. Nilsen & Arvid Raknerud & Terje Skjerpen, 2017. "Estimation of a model for matched panel data with high-dimensional two-way unobserved heterogeneity," Empirical Economics, Springer, vol. 53(4), pages 1657-1680, December.
    14. Jérôme De Henau & Leila Maron & Danièle Meulders & Sile Padraigin O'Dorchai, 2007. "Travail et maternité en Europe: conditions de travail et politiques publiques," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 50(1), pages 63-88.
    15. Sile Padraigin O'Dorchai, 2008. "Pay inequality in 25 European countries," DULBEA Working Papers 0006, ULB -- Universite Libre de Bruxelles.
    16. Pierre-Guillaume Méon & Ariane Szafarz, 2008. "Labor market discrimination as an agency cost," DULBEA Working Papers 08-19.RS, ULB -- Universite Libre de Bruxelles.
    17. Caroline Gerschlager, 2008. "Foolishness and identity: Amartya Sen and Adam Smith," DULBEA Working Papers 08-03.RS, ULB -- Universite Libre de Bruxelles.
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    19. Boeri, Tito, 2014. "Two-Tier Bargaining," IZA Discussion Papers 8358, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    Wage structure; matched employer-employee data; Belgium.;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts

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