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More insecure and less paid? The effect of perceived job insecurity on wage distribution

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  • Scicchitano, Sergio
  • Biagetti, Marco
  • Chirumbolo, Antonio

Abstract

This article employs a Counterfactual Decomposition Analysis (CDA) using both a semi-parametric and a non-parametric method to examine the pay gap, over the entire wage distribution, between secure and insecure workers on the basis of perceived job insecurity. Using the 2015 INAPP Survey on Quality of Work, our results exhibit a mirror J-shaped pattern in the pay gap, with a significant sticky floor effect, i.e. the job insecurity more relevant at the lowest quantiles. This pattern is mainly due to the characteristics effect, while the relative incidence of the coefficient component accounts roughly for 22 up to 36% of the total difference, being more relevant at the bottom of the wage distribution.

Suggested Citation

  • Scicchitano, Sergio & Biagetti, Marco & Chirumbolo, Antonio, 2018. "More insecure and less paid? The effect of perceived job insecurity on wage distribution," GLO Discussion Paper Series 293, Global Labor Organization (GLO).
  • Handle: RePEc:zbw:glodps:293
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    References listed on IDEAS

    as
    1. DiNardo, John & Fortin, Nicole M & Lemieux, Thomas, 1996. "Labor Market Institutions and the Distribution of Wages, 1973-1992: A Semiparametric Approach," Econometrica, Econometric Society, vol. 64(5), pages 1001-1044, September.
    2. Valeria Cirillo & Marta Fana & Dario Guarascio, 2017. "Labour market reforms in Italy: evaluating the effects of the Jobs Act," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 34(2), pages 211-232, August.
    3. Fabien Postel-Vinay & Eric Maurin, 2005. "The European job security gap," Post-Print halshs-00754090, HAL.
    4. Duncan Gallie & Alan Felstead & Francis Green & Hande Inanc, 2017. "The hidden face of job insecurity," Work, Employment & Society, British Sociological Association, vol. 31(1), pages 36-53, February.
    5. Keisuke Hirano & Guido W. Imbens & Geert Ridder, 2003. "Efficient Estimation of Average Treatment Effects Using the Estimated Propensity Score," Econometrica, Econometric Society, vol. 71(4), pages 1161-1189, July.
    6. repec:spr:soinre:v:137:y:2018:i:3:d:10.1007_s11205-017-1635-z is not listed on IDEAS
    7. Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October.
    8. Koutentakis, Franciscos, 2008. "The effect of temporary contracts on job security of permanent workers," Economics Letters, Elsevier, vol. 101(3), pages 220-222, December.
    9. Brendan Burchell, 2009. "Flexicurity as a moderator of the relationship between job insecurity and psychological well-being," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 2(3), pages 365-378.
    10. Koenker, Roger W & Bassett, Gilbert, Jr, 1978. "Regression Quantiles," Econometrica, Econometric Society, vol. 46(1), pages 33-50, January.
    11. Gerald Friedman, 2014. "Workers without employers: shadow corporations and the rise of the gig economy," Review of Keynesian Economics, Edward Elgar Publishing, vol. 2(2), pages 171-188, April.
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    More about this item

    Keywords

    Job (in)security; Counterfactual distribution; Semi-parametric methodology; Nonparametric methodology; Wage gap; Blinder/Oaxaca; Quantile regression; Italy;

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J82 - Labor and Demographic Economics - - Labor Standards - - - Labor Force Composition
    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General

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