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Overeducation and the Gender Pay Gap in Italy. A Double Selectivity Approach

Author

Listed:
  • Carolina Castagnetti

    (Department of Economics and Management, University of Pavia)

  • Luisa Rosti

    (Department of Economics and Management, University of Pavia)

  • Marina Toepfer

    (Institute of Economics, University of Hohenheim)

Abstract

We use a large Italian data set (ISFOL-PLUS 2005-2014) to estimate the gender pay gap (GPG) among overeducated workers. We show that overeducation is an important driver of the GPG. This result holds when controlling for sample selection and endogeneity problems, too. Neglecting selectivity issues may lead to the conclusion that discrimination is the most important driver of the GPG. Yet, when accounting for self-selection and endogeneity bias overeducation is found to merely reflect unobserved differences in personal characteristics such as innate ability. The selection coefficients for both the participation and the overeducation decision allow explaining almost the entire GPG.

Suggested Citation

  • Carolina Castagnetti & Luisa Rosti & Marina Toepfer, 2017. "Overeducation and the Gender Pay Gap in Italy. A Double Selectivity Approach," DEM Working Papers Series 144, University of Pavia, Department of Economics and Management.
    • Handle: RePEc:pav:demwpp:demwp0144
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    File URL: http://dem-web.unipv.it/web/docs/dipeco/quad/ps/RePEc/pav/demwpp/DEMWP0144.pdf
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    More about this item

    Keywords

    gender pay gap; double selection; Italy; discrimination; wages.;
    All these keywords.

    JEL classification:

    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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