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Why do women’s wages increase so slowly throughout their career? A dynamic model of statistical discrimination

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  • Nathalie Havet

    () (University of Lyon, Lyon, F-69003, France; CNRS, UMR 5824, GATE, Ecully, F-69130, France; ENS LSH, Lyon, F-69007, France ; Centre Leon Berard, Lyon, F-69003, France)

  • Catherine Sofer

    () (Université Paris1-Panthéon-Sorbonne, and Paris School of Economics)

Abstract

The aim of this paper is to explain the growing wage differentials between men and women during their working careers. We provide a dynamic model of statistical discrimination, which integrates specific human capital decisions: on-the-job training investment and wages are endogenously determined. We reveal a small wage differential at the beginning of women’s career, followed by a larger wage differential; this is partly due to a lower level of human capital investment by women and partly because firms smooth training costs between different periods.

Suggested Citation

  • Nathalie Havet & Catherine Sofer, 2007. "Why do women’s wages increase so slowly throughout their career? A dynamic model of statistical discrimination," Working Papers 0722, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
  • Handle: RePEc:gat:wpaper:0722
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    Cited by:

    1. Rune V. Lesner, 2016. "Testing for Statistical Discrimination based on Gender," Economics Working Papers 2016-07, Department of Economics and Business Economics, Aarhus University.

    More about this item

    Keywords

    gender gaps; gender wage gap; specific human capital; statistical discrimination;

    JEL classification:

    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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