Download - Gender wage gap in Poland: Can it be explained by differences in observable characteristics?
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Gender Wage Gap in Poland – Can It Be Explainedby Differences in Observable Characteristics?
TIMTED 2013
Karolina Goraus
Faculty of Economic SciencesUniversity of Warsaw
Timisoara, June 7th 2013
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Outline
1 Motivation
2 Research goals
3 Theoretical backgroundTheory of discriminationMethodology
4 Empirical results
5 Bibliography
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
What is the reason of gender wage differentials?
Gender wage gaps
Italy 2005 15,7% Picchio, Mussida, 2010Italy 2008 24,16% Nopo, Daza, Ramos, 2011
Czech Republic 1998 30% Jurajda, 2001Czech Republic 2008 35,19% Nopo, Daza, Ramos, 2011
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Motivation
Weichselbaumer and Winter-Ebmer (2007)meta-analysis of 263 papers exploring gender wage gaps in 62countriesincomparability of estimators
Nopo, Daza and Ramos (2011)attempt to estimate gender wage gaps for 63 countries withthe same methodologyhuge differences in gender gaps between countriesunknown reasons
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Research goals
1 Estimation of gender wage gaps with consistent methodologyfor many countries over time
2 Analysis of differences in gender wage gaps between countriesand their changes over time
3 Construction of antydiscriminatory policy recommendationsdepending on the form and sources of gender discrimination
First stage of the research
Choosing the methodology and implementing it to the case ofPoland
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Theory of discriminationMethodology
Kenneth J. Arrow
”The fact that different groups of workers, be they skilled orunskilled, black or white, or male or female, receive different wage,invites the exlanation that the different groups must differaccording to some characteristics valued on the market. Instandard economic theory, we think first of all of differences inproductivity. The notion of discrimination involves the additionalconcept that personal characteristics of the worker that areunrelated to productivity are also valued on the market.”
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Theory of discriminationMethodology
Assesment of wage differentials
Raw wage gap
Measuring the difference in average wages between males andfemales
Adjusted wage gap
Estimation of the component of raw gender wage gap that connotbe explained by differences in idividual characteristics
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Theory of discriminationMethodology
Methodology
Decomposition methods1 Parametric2 Non-parametric
Parametric Oaxaca-Blinder decomposition
Two components: one attributable to differences in averagecharacteristics of the individuals, and the other – to differences inrewards that these characteristics have
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Theory of discriminationMethodology
How to measure discrimination?
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Theory of discriminationMethodology
Attempts to refine the Oaxaca-Blinder decomposition
Male wage structure prevails in the absence ifdiscrimination → Other non-discriminatory wage structures(Naumark, 1988; Oaxaca i Ransom, 1994;)
Outcome variable continuous and unbounded → Solutionfor binary variable (Fairle, 2003), generalization to otherdiscrete and limited variables (Bauer and Sinning, 2008)
It is only informative about the average unexplaineddifference in wages → Expansion of the method to the caseof distributional parameters besides the mean (Juhn, Murphy,and Pierce, 1991; Machado, and Mata, 2005; DiNardo, Fortin,and Lemieux, 1996; Firpo, Fortin, Lemieux, 2007)
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Theory of discriminationMethodology
Attempts to refine the Oaxaca-Blinder decomposition
Problem: misspecification caused by differences in thesupports of the distribution of individual characteristicsfor females and males
There are combinations of characteristics for which it ispossible to find males but not females in the society, and viceversa → one cannot compare wages across genders (Rubin,1977)
Nopo (2008) adapted the tool of the program evaluationliterature, matching, to construct a non-parametric alternativeto Blinder-Oaxaca decomposition method and fix the problemof differences in the supports of distribution of characteristicsbetween females and males
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Theory of discriminationMethodology
Methodology
Oaxaca-Blinder decomposition
yM − yF = βM(xM − xF ) + (βM − βF )xF
Decomposition of Nopo
δ = δM + δX + δ0 + δF
δM - can be explained by differences between „matched” and„unmatched” malesδX - can be explained by differences in the distribution ofcharacteristics of males and females over the common supportδO - unexplained part of the gapδF - can be explained by differences between „matched” and„unmatched” females
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Decomposition of gender wage gap in Poland
Analysis based on the Labor Force Survey performed byCentral Statistical Office in Poland
Quarterly data from 1995q1 to 2011q4
Persons that are self-employed, unemployed, or inactive, aswell as miners and armed forces have been removed from thedata setAdditionally the pooled data set was created
it contains 690414 observationswages presented in PLN, constant prices of 1995share of males is 52.5%
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Raw gender wage gap
Average hourly wages forfemales over the years1995-2011 were12.5PLN, while for malesit was 13.7PLN - thedifference amounts toaround 9.3% of females’average wage
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Males (vs. Females) on Polish labour market
Demographic characteristics
Half year younger
Less educated
More often single
Less often in cities and in Warsaw
Job related characteristics
Shorter tenure with current employer but longer overall tenure
Less often in public sector
More often in agriculture, industry and construction sector,less often in services sector
Mostly in middle-skilled occupations
More often in big and medium companies
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Results of Nopo decomposition
Characteristics D D0 DM DF DX % M % KDemographic 10% 20% 0% 0% -10% 99 97+ Occupation 10% 20% 0% 0% -10% 96 93+ Sector 10% 20% -1% -1% -9% 92 92+ Public 10% 21% 0% -1% -10% 99 95+ Informal 10% 21% 0% 0% -10% 99 97+ Tenure 10% 21% 0% -1% -10% 99 95All 10% 19% -2% -1% -6% 65 74
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Raw wage gap vs. ”discrimination”
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Results of Nopo decomposition based on all characteristics
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Oaxaca-Blinder decomposition
Based on demographicvariables : unexplainedcomponent of 20%, thesame result as innon-parametric
Based on all variables:unexplained component of21.6%
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
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Comparison of decompositions
Decomposition type Raw gap Unexplained componentNopo 10% 19%Oaxaca-Blinder 10.1% 21.6%Oaxaca-Blinder over 10.1% 21.1%common support
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
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Sensitivity analysis
Adjusted wage gap bigger than the raw gapfor each wage quartilefor each age categoryboth in rural and urban areasin Mazowieckie region and outsidein public and in private sector
Adjusted wage gap (slightly) smaller than the raw gapfor people with tertiary, vocational and elementary educationfor occupations that require more skillsin industry and constructionin informal sector
Adjusted wage gap within particular groups of society isalways positive and vary between 12% and 27%
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Conclusions
Females to a greater extent exhibit characteristics that arewell rewarded in the labor market.
Despite better education, they are less frequently employed inbetter paying positions.
The raw gap over the period 1995-2011 amounts to app.10%. However, accounting for the differences in endowmentsthe actual wage gap grows to as much as 20%.
Despite covering already 17 years of data, we were not able toidentify any clear decreasing trend in gender discrimination inPoland.
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Thank you for your attention
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
Adamchik, V.A., Bedi, A. S. (2003). Gender pay differentialsduring the transition in Poland, The Economics of Transition vol.11, issue 4, p. 697.Atal, J. P., Hoyos, A., Nopo, H. (2010). NOPOMATCH: Statamodule to implement Nopo’s decomposition, Statistical SoftwareComponents, S457157, Boston College Department of Economics.Bauer, T., Sinning, M. (2008). An extension of theBlinder–Oaxaca decomposition to nonlinear models, Advances inStatistical Analysis, Springer, vol. 92(2), pages 197-206, May.Blinder, A. (1973). Wage Discrimination: Reduced Form andStructural Estimates, The Journal of Human Resources, VII, 4, pp.436-55.
Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
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Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
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Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
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Theoretical backgroundEmpirical results
Bibliography
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Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
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Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
MotivationResearch goals
Theoretical backgroundEmpirical results
Bibliography
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Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013
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Theoretical backgroundEmpirical results
Bibliography
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Karolina Goraus Gender Wage Gap in Poland – Can It Be Explained by Differences in Observable Characteristics? TIMTED 2013