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Wage Inequality and Returns to Education in Turkey: A Quantile Regression Analysis

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  • Aysit Tansel

    () (Middle East Technical University and Economic Research Forum (ERF) Cairo, Egypt)

  • Fatma Bircan

    () (Karaelmas University)

Abstract

This paper investigates the male wage inequality and its evolution over the 1994-2002 period in Turkey by estimating Mincerian wage equations using OLS and quantile regression techniques. Male wage inequality is high in Turkey. While it declined at the lower end of the wage distribution it increased at the top end of wage distribution. Education contributed to higher wage inequality through both within and between dimensions. The within-groups inequality increased and between-groups inequality decreased over the study period. The latter factor may have dominated the former contributing to the observed decline in the male wage inequality over the 1994-2002. Further results are provided for the wage effects of experience, cohort effects, public sector employment, geographic location, firm size, industry of employment and their contribution to wage inequality. Recent increases in FDI inflows, openness to trade and global technological developments are discussed as contributing factors to the recent rising within-groups wage inequality.

Suggested Citation

  • Aysit Tansel & Fatma Bircan, 2011. "Wage Inequality and Returns to Education in Turkey: A Quantile Regression Analysis," Koç University-TUSIAD Economic Research Forum Working Papers 1102, Koc University-TUSIAD Economic Research Forum.
  • Handle: RePEc:koc:wpaper:1102
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    More about this item

    Keywords

    Wage Inequality; Returns to Education; Quantile Regression; Turkey;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education

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