The Immigrant Wage Gap in Germany: Are East Europeans Worse Off?

Using employment register data, this study compares the outcomes of male foreign workers from different East and West European countries who entered the German labor market between 1995 and 2000 with those of male German workers. Although the wage differentials are highest for Poles, results from Oaxaca/Blinder type decompositions show that the East Europeans are not generally worse off. Actually, we find considerable heterogeneity also within nationality groups. Quantile decompositions show that coefficients effects tend to be larger at the bottom of the wage distribution and, by that, give evidence for sticky floors.     

Spillover Bias in Cross-Border Minimum Wage Studies: Evidence from a Gravity Model

This paper explores the problem of spillover bias in cross-border studies of the minimum wage using a commuter gravity model on county-level data from 2009 to 2013. Commuter flows conform to the expectations of the gravity equation, but flows across county borders are sensitive to changes in the minimum wage rate, which implies that minimum wage employment effect estimates using contiguous counties are likely to suffer from spillover bias. One way to address this bias is to include a control ring between treatment and comparison counties, although this solution may introduce biases of its own. A gravity model that includes a control ring affirms that this alternative comparison group can address this spillover bias problem.     

The Decomposition of Firm-size Wage Differentials

No completely satisfactory explanation for the persistent and well-documented large-firm wage premium has been found. I use a novel adaptation of the Oaxaca/Blinder wage discrimination model to examine the firm-size wage differential which allows the wage differential to be decomposed into the portions attributable to (1) differences in employee endowments, (2) how the firm values these endowments, and (3) residual differences. Small firms actually pay higher wages based on how they value their workers’ endowments, but this wage premium was overshadowed by the superior endowments of workers in large firms and a residual differential in favor of large firms.

Class Differences in Establishment Pathways to Fatherhood Wage Premiums

Organizations have been argued to favor fathers over childless men and skilled fathers over less‐skilled fathers, but group wage inequalities vary across as well as within establishments. This article theorizes class differences in the contribution of being employed in a high‐wage firm to the fatherhood wage premium. Analyses of linked employer–employee data from the Canadian Workplace and Employee Survey reveal that sorting into high‐wage establishments accounts for 60% of the economy‐wide premium for less‐educated and nonprofessional fathers, whereas high‐skilled fathers tend to work in lower wage establishments but receive the largest net fatherhood premium within firms. Among the subsample of fathers who changed employers in the past 5 years, less‐skilled fathers fared worse, whereas high‐skilled fathers sorted into high‐wage firms. Results thus suggest that employment in a higher wage firm likely enables less‐skilled men to transition to fatherhood, whereas high‐wage employers may discriminate in favor of only high‐skilled fathers in hiring.     

Intangibles and the Gender Wage Gap: An Analysis of Gender Wage Gaps Across Occupations in the Finnish Private Sector

The paper compares the gender wage differentials of two occupation groups—innovation and non-innovation workers—separately for manufacturing and services using Finnish private-sector data. We apply a decomposition method based on unconditional quantile regression techniques to identify key factors underlying the gender wage gaps observed along the whole wage distribution, as well as changes in these wage gaps between 2002 and 2009. This more nuanced approach provides important new insights. We find conspicuous differences in average gender wage gaps, in gender wage-gap profiles across the wage distribution and also in the evolution of gender wage differentials over time between sectors and occupation groups. Our results imply that sector-specific factors are a more important driving force behind these differences in patterns and trends of gender wage gaps, although occupation-specific factors cannot be totally dismissed. Hence, comparisons of gender wage gaps, including their underlying sources, of innovation and non-innovation workers for too broadly defined segments of the labour market may result in misleading conclusions concerning the factual role of intangible capital.     

The Gender Wage Gap in the United States and Cross Nationally

Scholarship in sociology and economics has long explored the gender wage gap. Recent research suggests that these inequalities are indicative of important differences not only between men and women, but among women and men, reflecting rising levels of income inequality among workers in the post‐industrial era. We argue that the most interesting debates in the gender wage gap – those exploring differences among subgroups by class, race, and/or parenthood status (such as the motherhood wage penalty), as well as those considering differences across countries – can bring new insights to the study of wage inequality, as well as to understandings of what drives gendered wage inequality.     

Examining Equality between Public- and Private-Sector Wage Distributions

Most comparability studies examine average pay differences, but this article explores differences in the distribution of public- and private-sector wages. Applying a new type of decomposition method, the results indicate that the difference in average wages is only a small part of wage incomparability, whereas differences in the variance of the differential are a much more important factor explaining incomparability. Further results find that differences in wage structure and unobservable factors determining wages have distinct effects in different parts of the wage distribution.     

The Gender Wage Gap in Belarus

A new release of the Belarusian Household Survey on Incomes and Expenditures provides the unique opportunity for an in-depth study of the gender pay gap in Belarus. The econometric analysis involves estimates of augmented earnings equations, also corrected for sample selection bias, as well as for least absolute deviations estimates at different quantiles of the wage distribution. The results suggest that the gender wage gap is smaller than in other countries of the Commonwealth of Independent States and Central and Eastern European countries, as one would expect considering the slow transition process, and is reduced after controlling for unobservable characteristics. Moreover, the gap increases as one moves from the 10th to the 90th quantile. This means that having jobs providing generally higher levels of wages for a woman, it is more and more difficult to get the same wage as that of a man.     

Union Worker Wage Effect in the Public Sector

This study examines union wage premiums in the public sector for the 1998–2004 period. Unlike previous studies, our approach estimates union wage premiums considering differences in the rewards to education, experience, and other personal characteristics for union and non-union workers. The approach provides a larger estimated wage gap than the traditional approach, and allows for simulations of union–nonunion wage gaps for different types of workers. Moreover, we use an Oaxaca decomposition to explain the larger union–nonunion wage gap in the private sector in comparison to that in the public sector. We find that between 50% and 60% of the difference in union wage premiums between the private and public sectors is due to differences in the way unionized workers are rewarded in the private and public sectors, while the remaining portion is due to differences in personal characteristics of private and public sector workers.

The Wage Gap between Foreign and Spanish Nationals in Spain: an Analysis Using Matched Employer–Employee Data

In this paper, we analyse wage differences between foreign and Spanish nationals in Spain. This analysis is relevant because Spain has witnessed a sharp increase in the proportion of foreign workers over the past decade. In our analysis, we explicitly account for unobserved heterogeneity at firm level, a situation which occurs when relevant covariates (for example, those connected to a specific firm's production process) are not included in the model because they are unmeasurable, unobservable or unavailable for the researcher. When accounting for such heterogeneity, our results show that wage gaps between foreign nationals from developing countries and Spanish nationals range between ?6.35 per cent and ?11.30 per cent. We also find that wage differences, between Spanish nationals and others in the same firm and job, are substantially greater for almost every group of low‐tenured foreign workers and also for those holding open‐ended contracts.     

Native‐Migrant Wage Differential Across Occupations: Evidence from Australia

We investigate wage differential by migrant status across white‐collar and blue‐collar occupations in Australia. Migrants are observed to have a higher wage; this difference, however, does not exist once we control for covariates. The unconditional wage differential varies over wage distribution as well as by occupation. Significant wage differentials are found above the median: positive for white‐collar workers and negative for blue‐collar workers. Using recently developed decomposition methods based on Firpo, Fortin, and Lemieux (2009) we decompose wage differentials across their distribution. Overall, the wage advantage of migrants reflects their superior labour market characteristics, and in particular, their levels of education. We find that English language proficiency plays an important role in wage differences among immigrants from non‐English speaking countries.     

Motherhood and Earnings: Wage Variability by Major Occupational Category and Earnings Level

Prior research has indicated that women with children earn less than their childless counterparts. In addition, recent research has found that the motherhood wage penalty may be most severe for low-income earners. Using panel data from the National Longitudinal Survey of Youth (1979), we test two hypotheses. First, are there occupational differences in the motherhood wage penalty? Second, are there occupational differences in the relative wage penalty experienced by low and high wage mothers? Our results indicated that mothers in sales occupations are penalized at a significantly higher rate than mothers in non-sales occupations, while mothers in blue-collar occupations were penalized the least. Furthermore, the wage cost of motherhood was greatest amongst the highest earners in sales occupations.     

Wage distribution and firm size: The case of the United States

Substantial literature has been produced on the increasing wage gap in the United States, invoking various possible factors, but largely ignoring the relationship between firm size and wage distribution. In this study, the author decomposes wage differences over time between large, medium and small firms, identifying the effects of observed characteristics (and their returns) along with residual inequality, i.e. inequality among workers with the same observed characteristics. From 1992 to 2012, trends at small, medium and large firms became more uniform, while wage inequality rose across the board. Significantly, it increased more quickly in the upper half of the wage distribution and at large firms, where residual inequality was highest.     

Racial wage differentials among young adults: Evidence from the 1990s

This study seeks to decompose wage differentials between black and white male young adults into those related to labor market discrimination and those resulting from human capital endowments. The importance of testing for significant differences in wage equations before conducting decomposition analysis is emphasized. Study results demonstrate that ignoring correction for the sample selection bias resulting from black-white differences in the probability of being employed would lead to an underestimation of the size of wage differentials. The study also shows that the results of models based on different assumptions regarding the nondiscriminatory wage structure might lead to different conclusions pertinent to the extent of labor market discrimination. Implications for public policy development are discussed. His current research interests include consumption economics, income distribution, and international comparative analyses of households' resources allocation. He received his Ph.D. from the University of Missouri at Columbia. Her current research interests include family financial distribution and wellbeing and individual and family resource management. She received her Ph.D. from Iowa State University.     

The Effects of Prevailing Wage Laws: A Comparison of Individual Workers'' Wages Earned on and off Prevailing Wage Construction Projects

I evaluate the effects of prevailing wage laws using a unique data set that shows the wages paid to workers on prevailing wage projects and the wages paid to the same workers during the same time period for work on projects not covered by prevailing wage regulations. The wage comparison shows that workers are generally paid more for work on prevailing wage projects than they are for work on non-prevailing wage projects. Thus, prevailing wage laws likely do increase the cost of public construction. In addition, to the extent that the quality of construction is improved, prevailing wage laws appear to be an inefficient mechanism by which to achieve additional quality, as the regulations often result in workers being paid more than they earn in the private market.     

Visualising Gender Wage Differences in the European Union

The purpose of this article is to illustrate differences in the gender wage gap in 13 EU member states, using figures taken from the Household Panel for 2000. The methodology is based primarily on the kernel density functions of men's and women's wages. A range of situations can be observed from the Mediterranean countries (with a smaller gender pay gap) to the very specific cases of Austria and the UK and to northern European countries where the gender pay gap is chiefly the result of a larger proportion of men at higher‐paid levels. We also offer conclusions on the relevance of public employment, part‐time employment and short‐term hiring to explain the gender wage gap in each of the countries studied.     

Wage Inequality and Performance in Nonprofit and For‐Profit Organizations

This article examines the effects of several forms of wage inequality on service quality and employee effort. We suggest that two popular theories, tournament and fair wage/equity, are not necessarily competing. Each theory accurately describes aspects of employee behavior, but because of sectoral differences in organizational objectives and employee attitudes, tournament theory's predictions are relatively stronger in the for‐profit sector, while fair wage/equity theory's predictions are relatively stronger in the nonprofit sector. Using an employer–employee matched data set of nursing homes linked to a federal regulatory database and a resident survey, we found that ownership moderates the relationship between wage inequality and service quality. Although wage inequality positively affects service quality in the for‐profit sector, the reverse is true among nonprofit organizations. We also found that overall wage inequality in the workplace has a more pronounced influence on employee discretionary effort than does the employee's place in the distribution of wages.     

Testing Fair Wage Theory

Fairness considerations often are invoked to explain wage differences that appear unrelated to worker characteristics or job conditions, but non-experimental tests of fair wage models are rare because market data rarely permit researchers to measure individual workers’ productivity and its value. We use data from the baseball labor market to address this problem, and find no support for fair wage theory. We do find, however, that fairness premia can be illusory: Wages appear to incorporate fairness premia in regressions that control for variation in individuals’ physical output, but such premia evaporate when the value of that output is held constant.

Marriage and the Motherhood Wage Penalty Among African Americans,Hispanics, and Whites

This study draws on data from the National Longitudinal Survey of Youth (N = 5,929) to analyze the moderating effects of race and marriage on the motherhood wage penalty. Fixed‐effects models reveal that for Hispanic women, motherhood is not associated with a wage penalty. For African Americans, only married mothers with more than 2 children pay a wage penalty. For Whites, all married mothers pay a wage penalty, as do all never‐married mothers and divorced mothers with 1 or 2 children. These findings imply that racial differences in the motherhood wage penalty persist even for women with similar marital statuses, and they suggest that patterns of racial stratification shape women’s family experiences and labor market outcomes.     

Education,Skills, and Wage Gaps in Canada and the United States

We analyse data from the Programme for the International Assessment of Adult Competencies to reveal that immigrants in Canada and the United States make over $200 less per month than native‐born workers. In the United States, immigrants disproportionately work in low‐wage occupations, leading to large mean national differences between immigrants and native workers. The wage differential disappears after accounting for education and cognitive skills, indicating policies must focus on reducing education and skill gaps in the United States. In Canada, an immigrant wage gap persists in nearly all occupational fields, suggesting that the better skilled and educated immigrants in Canada are not receiving the same wage premium as native workers. We close with implications for policy and future research.