Nonprofit/For-profit Facility and Difference of Wage Distribution: Evidence from the Japanese elderly care industry

This paper provides new estimation results for the impacts of operator types, nonprofit or for-profit, on earnings distribution by using employee-employer matched data in the Japanese elderly care sector. The ordinary least squares (OLS) and quantile regression results show that even if workers' and operators' basic characteristics are controlled, we can observe a nonprofit premium on average and in lower quantiles. However, in higher quantiles, we observe a negative premium (penalty) of nonprofit operators. Additionally, average and quantile decomposition results represent that, on average and in each quantile, a large part of a nonprofit premium can be explained by the difference of observable characteristics, especially the license acquisition rate and worker's tenure. The quantile decomposition results additionally show that a larger part of earnings gap in high quantiles can be explained by the difference of tenure than in lower quantiles.