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Wage Inequality and Wage Mobility in Turkey

Listed author(s):
  • Aysit Tansel

    ()

    (Department of Economics, Middle East Technical University, Institute for the Study of Labor (IZA) Bonn, Germany and Economic Research Forum (ERF) Cairo, Egypt)

  • Basak Dalgic

    ()

    (Department of Public Finance Hacettepe University)

  • Aytekin Guven

    ()

    (Department of Economics Abant İzzet Baysal University)

This paper investigates wage inequality and wage mobility in Turkey using the Surveys on Income and Living Conditions (SILC). This is the first paper that explores wage mobility for Turkey. It differs from the existing literature by providing analyses of wage inequality and wage mobility over various socioeconomic groups such as gender, age, education and sector of economic activity. We first present an overview of the evolution of wages and wage inequality over the period 2005-2011. Next, we compute several measures of wage mobility and explore the link between wage inequality and wage mobility. Further, we compute the transition matrices which show movements of individuals across the wage distribution from one period to another and investigate the determinants of transition probabilities using a multinomial logit model. The results show that overall the real wages increased over the study period and wage inequality exhibits a slight increase.. Wage inequality is one of the highest among the European Union (EU) countries. The wage mobility in Turkey is lower than what is observed in the European Union countries although it increases as time horizon expands. Wage mobility has an equalizing impact on the wage distribution, however; this impact is not substantial enough to overcome the high and persistent wage inequality in Turkey.

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File URL: http://eaf.ku.edu.tr/sites/eaf.ku.edu.tr/files/erf_wp_1419.pdf
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Paper provided by Koc University-TUSIAD Economic Research Forum in its series Koç University-TUSIAD Economic Research Forum Working Papers with number 1419.

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Length: 54 pages
Date of creation: Nov 2014
Handle: RePEc:koc:wpaper:1419
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  1. Aysit Tansel & Fatma Bircan Bodur, 2012. "Wage Inequality and Returns to Education in Turkey: A Quantile Regression Analysis," Review of Development Economics, Wiley Blackwell, vol. 16(1), pages 107-121, 02.
  2. Canto, Olga, 2000. "Income Mobility in Spain: How Much Is There?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 46(1), pages 85-102, March.
  3. Lawrence F. Katz & Kevin M. Murphy, 1992. "Changes in Relative Wages, 1963–1987: Supply and Demand Factors," The Quarterly Journal of Economics, Oxford University Press, vol. 107(1), pages 35-78.
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  16. Aytekin Güven & Başak Dalgıç & Aysit Tansel, 2014. "Gelir Hareketliliği Eşitsizlikleri Azaltabilir Mi? Türkiye Örneği," Working Papers 2014/07, Turkish Economic Association.
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  22. repec:zbw:rwirep:0386 is not listed on IDEAS
  23. Bakis, Ozan & Polat, Sezgin, 2013. "Wage Inequality in Turkey: 2002-2010," GIAM Working Papers 13-9, Galatasaray University Economic Research Center.
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  26. Gary Fields, 2010. "Does income mobility equalize longer-term incomes? New measures of an old concept," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 8(4), pages 409-427, December.
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