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The Gender Pay Gap for Private Sector Employees in Canada and Britain

  • Marie Drolet
  • Karen Mumford

This paper uses British and Canadian linked employer-employee data to investigate the importance of the workplace for the gender wage gap. Implementing a novel decomposition approach, we find substantial unexplained wage gaps in the private sector of both countries. Whilst this wage differential is partially offset by women, on average, receiving a workplace specific return which is relatively higher than that paid to men, a substantial and significant unexplained within workplace wage gap remains which is considerably higher in Britain than in Canada. The results are consistent with a prima facie argument that country-specific factors, such as the wage setting environment, are important determinants in explaining the relative size of the gender wage gap.

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Paper provided by Department of Economics, University of York in its series Discussion Papers with number 09/28.

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Handle: RePEc:yor:yorken:09/28
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  1. Marie Drolet, 2002. "Can the workplace explain Canadian gender pay differentials?," New Zealand Economic Papers, Taylor & Francis Journals, vol. 36(1), pages 75-77.
  2. Daly, Anne & Kawaguchi, Akira & Meng, Xin & Mumford, Karen A., 2006. "The Gender Wage Gap in Four Countries," IZA Discussion Papers 1921, Institute for the Study of Labor (IZA).
  3. Michael Baker & Nicole M. Fortin, 2000. "Occupational Gender Composition and Wages in Canada: 1987-1988," Working Papers baker-00-01, University of Toronto, Department of Economics.
  4. John J. Abowd & John Haltiwanger & Julia Lane, 2004. "Integrated Longitudinal Employer-Employee Data for the United States," American Economic Review, American Economic Association, vol. 94(2), pages 224-229, May.
  5. Mark B. Stewart, 1982. "On Least Squares Estimation When the Dependent Variable is Grouped," Working Papers 539, Princeton University, Department of Economics, Industrial Relations Section..
  6. 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.
  7. Sara Connolly & Mary Gregory, 2008. "Moving Down: Women's Part-Time Work and Occupational Change in Britain 1991-2001," Economic Journal, Royal Economic Society, vol. 118(526), pages F52-F76, 02.
  8. Gary S. Becker, 1962. "Investment in Human Capital: A Theoretical Analysis," Journal of Political Economy, University of Chicago Press, vol. 70, pages 9.
  9. Manning, Alan & Petrongolo, Barbara, 2007. "The Part-Time Pay Penalty for Women in Britain," CEPR Discussion Papers 6058, C.E.P.R. Discussion Papers.
  10. Mueller, Richard E., 1998. "Public-private sector wage differentials in Canada: evidence from quantile regressions," Economics Letters, Elsevier, vol. 60(2), pages 229-235, August.
  11. Regan, Tracy L. & Oaxaca, Ronald L., 2006. "Work Experience as a Source of Specification Error in Earnings Models: Implications for Gender Wage Decompositions," IZA Discussion Papers 1920, Institute for the Study of Labor (IZA).
  12. Ronald L. Oaxaca & Michael R. Ransom, 1999. "Identification in Detailed Wage Decompositions," The Review of Economics and Statistics, MIT Press, vol. 81(1), pages 154-157, February.
  13. Joseph G. Altonji & Rebecca M. Blank, . "Race and Gender in the Labor Market," IPR working papers 98-18, Institute for Policy Resarch at Northwestern University.
  14. Kimberly Bayard & Judith Hellerstein & David Neumark & Kenneth Troske, 2003. "New Evidence on Sex Segregation and Sex Differences in Wages from Matched Employee-Employer Data," Journal of Labor Economics, University of Chicago Press, vol. 21(4), pages 887-922, October.
  15. Francine D. Blau & Lawrence M. Kahn, 2001. "Understanding International Differences in the Gender Pay Gap," NBER Working Papers 8200, National Bureau of Economic Research, Inc.
  16. Richard Disney & Amanda Gosling, 2008. "Changing public sector wage differentials in the UK," IFS Working Papers W08/02, Institute for Fiscal Studies.
  17. Marie Drolet, 2002. "Can the Workplace Explain Canadian Gender Pay Differentials?," Canadian Public Policy, University of Toronto Press, vol. 28(s1), pages 41-63, May.
  18. Ronald Oaxaca, 1971. "Male-Female Wage Differentials in Urban Labor Markets," Working Papers 396, Princeton University, Department of Economics, Industrial Relations Section..
  19. Karen Mumford & Peter N. Smith, 2003. "Determinants of current job tenure: a cross country comparison," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 6(3), pages 435-451, September.
  20. Xin Meng & Dominique Meurs, 2004. "The gender earnings gap: effects of institutions and firms--a comparative study of French and Australian private firms," Oxford Economic Papers, Oxford University Press, vol. 56(2), pages 189-208, April.
  21. Rhys Davies & Richard Welpton, 2008. "How Does Workplace Monitoring Affect the Gender Wage Differential? Analysis of the Annual Survey of Hours and Earnings and the 2004 Workplace Employment Relations Survey - A Research Note," British Journal of Industrial Relations, London School of Economics, vol. 46(4), pages 732-749, December.
  22. Alan S. Blinder, 1973. "Wage Discrimination: Reduced Form and Structural Estimates," Journal of Human Resources, University of Wisconsin Press, vol. 8(4), pages 436-455.
  23. Mumford, Karen A. & Smith, Peter N., 2004. "The Gender Earnings Gap in Britain," IZA Discussion Papers 1109, Institute for the Study of Labor (IZA).
  24. Linda Dickens, 2007. "The Road is Long: Thirty Years of Equality Legislation in Britain," British Journal of Industrial Relations, London School of Economics, vol. 45(3), pages 463-494, 09.
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