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The Gender Earnings Gap: Some International Evidence

  • Francine D. Blau
  • Lawrence M. Kahn

This paper uses micro-data to analyze international differences in the gender pay gap among a sample of ten industrialized nations. We particularly focus on explaining the surprisingly low ranking of the U.S. in comparison to other industrialized countries. Empirical research on gender pay gaps has traditionally focused on the role of gender-specific factors, particularly gender differences in qualifications and differences in the treatment of otherwise equally qualified male and female workers (i.e., labor market discrimination). An innovative feature of our study is to focus on the role of wage structure--the array of prices set for various labor market skills--in influencing the gender gap. The striking finding of this study is the enormous importance of overall wage structure in explaining the lower ranking of U.S. women. Our results suggest that the U.S. gap would be similar to that in countries like Sweden, Italy and Australia (the countries with the smallest gaps) if the U.S. had their level of wage inequality. This insight helps to resolve three puzzling sets of facts: (1) U.S. women compare favorably with women in other countries in terms of human capital and occupational status: (2) the U.S. has had a longer and often stronger commitment to equal pay and equal employment opportunity policies than have most of the other countries in our sample; but (3) the gender pay gap is larger in the U.S. than in most industrialized countries. An important part of the explanation of this pattern is that the labor market in the U.S. places a much larger penalty on those with lower levels of labor market skills (both measured and unmeasured).

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 4224.

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Date of creation: Dec 1992
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Publication status: published as Blau, Francine D. and Lawrence M. Kahn, "Wage Structure and Gender Earnings Differentials: An International Comparison," Economica, vol. 63, no. 250 (supplement: Economic Policy and Income Distribution), pp. S29-S62, May 1996
Handle: RePEc:nbr:nberwo:4224
Note: LS
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  1. Jacob Mincer & Solomon Polacheck, 1974. "Family Investments in Human Capital: Earnings of Women," NBER Chapters, in: Economics of the Family: Marriage, Children, and Human Capital, pages 397-431 National Bureau of Economic Research, Inc.
  2. Johnson, George & Solon, Gary, 1986. "Estimates of the Direct Effects of Comparable Worth Policy," American Economic Review, American Economic Association, vol. 76(5), pages 1117-25, December.
  3. Barbara R. Bergmann, 1974. "Occupational Segregation, Wages and Profits When Employers Discriminate by Race or Sex," Eastern Economic Journal, Eastern Economic Association, vol. 1(2), pages 103-110, April.
  4. Erica L. Groshen, 1987. "The structure of the female/male wage differential: is it who you are, what you do, or where you work?," Working Paper 8708, Federal Reserve Bank of Cleveland.
  5. Elaine Sorensen, 1990. "The Crowding Hypothesis and Comparable Worth," Journal of Human Resources, University of Wisconsin Press, vol. 25(1), pages 55-89.
  6. Lawrence F. Katz & Kevin M. Murphy, 1991. "Changes in Relative Wages, 1963-1987: Supply and Demand Factors," NBER Working Papers 3927, National Bureau of Economic Research, Inc.
  7. Zabalza, Antoni & Tzannatos, Zafiris, 1985. "The Effect of Britain's Anti-discriminatory Legislation on Relative Pay and Employment," Economic Journal, Royal Economic Society, vol. 95(379), pages 679-99, September.
  8. Sanders Korenman & David Neumark, 1991. "Does Marriage Really Make Men More Productive?," Journal of Human Resources, University of Wisconsin Press, vol. 26(2), pages 282-307.
  9. Mark R. Killingsworth, 1990. "The Economics of Comparable Worth," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number ecw.
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