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The Labor Market Gender Gap in Denmark: Sorting Out the Past 30 Years

Author

Listed:
  • Gallen, Yana

    () (Harris School, University of Chicago)

  • Lesner, Rune V.

    () (Aarhus University)

  • Vejlin, Rune Majlund

    () (Aarhus University)

Abstract

We document the declining gap between the average earnings of women and men in Denmark from 1980 to 2010. The decline in the earnings gap is driven by increased labor force participation and increases in hours worked by women, and to a smaller extent by a decline in the gender wage gap. The gap has declined least among higher earning women – the average wage of the top 10 percent of female earners is 28-33% lower than the average wage of the top 10 percent of male earners. Women are becoming more educated and are a larger share of the professional labor force than in previous decades, but a substantial wage gap of about 10 percent remains for the youngest cohorts even after controlling for age, education, experience, occupation, and firm choice. Unlike the case of the US, differences in educational attainment, occupational choice, industry, and experience explained about 15 percentage points of the Danish wage gap in 1980, but now these factors explain only about 6 percentage points of the Danish wage gap. In fact, though variation in the wage gap across occupations is substantial, this variation is not correlated with the fraction of the occupation which is female. The data show a great deal of sorting and segregation across industries, occupations, and even firms. However, this sorting does not explain more than half of the wage gap. We conclude that a great deal of the remaining disparity between the wages of women and men is tied to the differential effects of parenthood by gender.

Suggested Citation

  • Gallen, Yana & Lesner, Rune V. & Vejlin, Rune Majlund, 2017. "The Labor Market Gender Gap in Denmark: Sorting Out the Past 30 Years," IZA Discussion Papers 10789, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp10789
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    References listed on IDEAS

    as
    1. Bagger, Jesper & Sørensen, Kenneth L. & Vejlin, Rune, 2013. "Wage sorting trends," Economics Letters, Elsevier, vol. 118(1), pages 63-67.
    2. Nikolay Angelov & Per Johansson & Erica Lindahl, 2016. "Parenthood and the Gender Gap in Pay," Journal of Labor Economics, University of Chicago Press, vol. 34(3), pages 545-579.
    3. David Card & Ana Rute Cardoso & Patrick Kline, 2016. "Bargaining, Sorting, and the Gender Wage Gap: Quantifying the Impact of Firms on the Relative Pay of Women," The Quarterly Journal of Economics, Oxford University Press, vol. 131(2), pages 633-686.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    gender pay gap; sorting;

    JEL classification:

    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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